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Posts Tagged ‘NYCEDC’

Exclusive: NYCEDC Kiss-Off Letter to Coney Island Boardwalk 8

Posted in Redevelopment, tagged Boadwalk, Central Amusement International, Coney Island 8, Economic Development Corporation, Mayor Bloomberg, NYCEDC on January 6, 2011| 6 Comments »

ATZ obtained a copy of the cruel kiss-off letter sent by the City’s Economic Development Corporation (NYCEDC) to the Coney Island Boardwalk businesses on October 25th. The City’s lease with the businesses was set to expire just a few days later on the 31st. “Please be advised that effective as of the date of this letter, the NYCEDC (“Licensor”) has assigned its interest as Licensor under your license for the premises to Central Amusement International.”

It appears to be a slick legal maneuver by the City to abdicate responsibility for the November 1st eviction of these Mom and Pops from City-owned property by CAI, which the City certainly must have known about in advance. CAI’s Luna Park is a public-private partnership and everything of importance is done in consultation with the City. The letter is signed by John Cicerello, Executive Vice President of EDC’s Assets Management, which “manages, maintains and leases over 20 million square feet of City property assets with the goal of maximizing return on assets.”

The kiss-off letter begins “Dear Sir or Madam”– the same salutation as CAI’s October 29th surrender the premises letter— which ATZ previously posted. We have to wonder if both letters were drafted by the NYCEDC attorneys or is this type of letter always so generic and coldly impersonal?

The letter states that as of the date of this letter “any and all matters regarding your License and the Premises should be addressed with Central Amusement International.” Any license fees and charges. Any notices, inquiries, requests. Any anything. In other words, the City’s done with you, Sir or Madam. Don’t call us, blame us, bother us, ask us for support.

After the Boardwalk businesses received the eviction letters on November 1st, City officials–both elected and appointed–tried to distance themselves by referring all questions to the amusement operator. Officials told the business owners it was Zamperla’s decision and there was nothing they could do. The businesses, which had been expecting responses to their business plans, were shocked and dismayed to receive eviction notices instead.

In advance of an eviction hearing scheduled for January 10, both sides are expected to get together for talks today. Will there be an out of court settlement? At a previous hearing on December 10, NYCEDC attorneys and a representative of the asset management department were present along with Valerio Ferrari, CEO of Zamperla USA and Central Amusement International.

Last Day at Paul's Daughter. Coney Island Boardwalk. November 13, 2010. © Tricia Vita/me-myself-i via flickr

The Coney Island Eight’s new website asks “Who is behind the eviction of the Coney Island 8”? Their answer is that the City made the decision as to who was going to be on the boardwalk long before any proposals were submitted.

It has been reported that Central Amusements was responsible for the ousting of the Coney Island Boardwalk Businesses. This is not true. The City of New York under the leadership of Mayor Bloomberg are the primary developers of Coney Island. This became evident in meetings with Central Amusements when their top Management explained to the Boardwalk vendors that Mayor Bloomberg met with them and told them that he wanted the Boardwalk to have a fresh look. It was two days before the renewal of leases the owners of the land turned all the leases over to Central Amusements to give the impression that Central Amusements made this decision.

Save Ruby's 'Axis of Evil' Protest Sign. January 1, 2011. Photo © Rubyshost via flickr

Bitter Week Ahead: Coney Island 8 Summoned to Court, Shore & Henderson Demo

Posted in Redevelopment, tagged Boardwalk businesses, Central Amusement International, Coney Island, Economic Development Corporation, Luna Park, NYCEDC on December 6, 2010| 8 Comments »

Demolition of Thor Equities-Owned Shore Hotel, Coney Island. December 5, 2010. Photo © Eric Kowalsky

Tis the season to be jolly, but there won’t be any fa-la-la-ing in good ol’ Coney Island this week. Last Wednesday, notices from attorneys for Luna Park operator Central Amusement International (CAI) were posted on the gates of the evicted Boardwalk businesses summoning them to court on December 10. CAI has retained the law firm of Davidoff, Malito & Hutcher, who filed a lawsuit to force the Coney Island 8 to “surrender the subject premises.” The eight businesses are Ruby’s, Cha Cha’s, Paul’s Daughter, Grill House, Gyro Corner, Shoot the Freak, Beer Island and Coney Island Souvenir Shop.

On Friday, Thor Equities demolition crew gutted the first floors of the Shore Hotel and the Bowery side of the Henderson Building. The dirty work will continue this week. Along with the demolished Bank of Coney Island, these historic buildings were doomed by the City’s rezoning of the parcels for high-rise hotels in 2009. A demolition permit was issued to Thor Equities in August and the Henderson’s remaining tenants were evicted, though a hotel is not expected to be built anytime soon. If you come to Coney Island for the New Year’s Day Polar Bear Swim, when you exit Stillwell Terminal and look across Surf, it’s likely the buildings will be demolished by then. What you’ll see is another empty lot to add to real estate speculator Joe Sitt’s collection of empty lots in Coney Island.

View of Thor Equities-owned Shore Hotel and Henderson Building in Coney Island. July 12, 2009. Photo © Tricia Vita/me-myself-i via flickr

Before the Demolition: View of Thor Equities-owned Shore Hotel and Henderson Building in Coney Island. July 12, 2009. Photo © Tricia Vita/me-myself-i via flickr

Will Ruby’s Bar be open on New Year’s Day? The Sarrels hope so, we hope so, but nobody knows. The future of the eight Boardwalk businesses will be the subject of legal wrangling this week, both behind the scenes and in court on Friday. According to the notice from CAI’s attorneys, copies of which were also sent by certified mail, “a hearing at which you must appear will be held at the Civil Court of the City of New York, 141 Livingston Street, ~~Part 52, Room 94(C)~~ on December 10 at 10 am.” (Update: The room number has been changed. We were requested not to post the new room number since the court date may not be open to the public.)

The notice also stated that “the license premises are an integral part of redevelopment” and that “time is of the essence.” Respondents were told to “surrender the subject premises” or face penalties of $2,000 per day. The previous notice to quit by November 19th, which ATZ posted last month, is referenced in the document. Central Amusement International states that the sublease with the businesses commenced on January 25, 2010 and ended on October 31, 2010.

Ruby's Rally, Party & Last Call. November 6, 2010. Photo © Tricia Vita/me-myself-i via flickr

We hope some kind of agreement can be reached to allow indigenous Mom & Pops such as Ruby’s and Paul’s Daughter to be part of the new Coney Island. The sudden notice to “vacate the premises” sent to the Boardwalk veterans on the day after the season ended calls to mind Thor Equities’ Christmas Eve lockout of 2008, when Joe Sitt was dubbed “The Grinch Who Stole Christmas” by the NY Post. In that infamous incident, Sitt’s henchmen cut locks on Boardwalk businesses and hung up banners advertising Stores for Lease. Lynn Kelly, then president of the Coney Island Development Corporation, told the Post, ‘Sitt’s behavior shows why the mayor’s planned rezoning is needed, “so that the boardwalk businesses and all of Coney Island have a chance to thrive.'”

Just days before CAI’s “vacate the premises” notice was delivered to the Coney Island 8 on November 1st, Kelly left her longtime position with the CIDC and NYCEDC (Economic Development Corporation) for a new job as CEO of Staten Island’s Snug Harbor Cultural Center. Too bad we’ll never get to hear Kelly’s explanation for the eviction of the Boardwalk businesses by Luna Park, which is a public private partnership with the EDC and Kelly was fond of calling “her park.” Neither the EDC nor the Mayor’s Office will comment to the press about the Mom & Pop businesses booted off City-owned property in Coney Island. The NYCEDC leased the Boardwalk property to CAI, the New Jersey-based operator of Coney Island’s new Luna Park. City officials–both appointed and elected–continue to distance themselves from responsibility for the evictions by remaining silent and referring all requests for comment to CAI.

UPDATE… December 9, 2010

Friday morning’s 10 a.m. court date for the eviction of the “Coney Island Eight” reportedly got postponed at the request of their attorney. ATZ was told that a postponement is a basic move at the beginning of a case. We’re not reading anything into it. Not yet. Stay tuned for new date.

UPDATE… December 10, 2010

The judge adjourned the hearing till January 10, 2011.

Boardwalk 8. November 27, 2010. Photo © Bruce Handy/Pablo 57 via flickr

Sign on Grill House: Save Coney Island 8. What About Us? November 27, 2010. Photo © Bruce Handy/Pablo 57 via flickr

Under Construction: Luna Park Coney Island’s $1.4M Sodexo-Run Restaurant & More

Posted in Food & Drink, Redevelopment, tagged Coney Island, Economic Development Corporation, Luna Park, New Restaurant, NYCEDC, Sodexo on December 2, 2010| 2 Comments »

Under Construction: Restaurant at Surf Ave and 10th Street in Luna Park. November 24, 2010. Photo © Bruce Handy/Pablo 57

At the corner of Surf Avenue and 10th Street in Coney Island, construction workers have been emptying rubble into a dumpster and digging up the street. It doesn’t look like much now, but by next season a $1.4 million sit-down restaurant with a view of the Cyclone roller coaster will be open for business.

As ATZ reported last week, the new restaurant will be run by Luna Park’s partner Sodexo, one of the largest food and facilities management companies in the world. Luna Park CEO Valerio Ferrari told ATZ that $1.4 million is being invested in the restaurant, which will be open year-round and feature waiter service and a variety of food.

Unlike the Sodexo-run restaurants set to take over what Ferrari described as “some but not all” of the Boardwalk businesses, this location is not controversial since the property was already vacant. Gregory & Paul’s Surf Avenue eatery closed after Thor Equities booted out Astroland two years ago. What’s controversial is corporate giant Sodexo’s highly unpublicized partnership with Luna Park Coney Island, which is itself a public private partnership with the City of New York. Why didn’t the NYCEDC issue a press release in May?

Since ATZ broke the news in Meet Sodexo: Luna Park Coney Island’s Partner for “On-Site Service Solutions” (November 23, 2010), readers have emailed us links to articles about everything from high prices in Sodexo-run college cafeterias in New York and New Jersey to the Washington Post’s “D” grade for the Sodexo-run cafeteria at the U.S. Department of Agriculture.

The most notable link is a press release from Attorney General Andrew Cuomo in July announcing “a $20 million settlement with food services provider Sodexo for overcharging 21 New York school districts as well as the SUNY system…” Said Cuomo, “This company cut sweetheart deals with suppliers and then denied taxpayer-supported schools the benefits. The state and federal regulations regarding such contracts exist to protect taxpayers, and I thank the whistleblowers for having the courage to bring this to our attention.”

Forty Year Old Business Being Replaced by Sodexo: Paul's Daughter on Coney Island Boardwalk. Photo © Tricia Vita/me-myself-i via flickr

New York Magazine’s Grub Street asked “Could a 40-Year-Old Coney Institution Be Replaced By a Corporate Cafeteria Giant?” Yes, according to Ferrari, Sodexo is expected to take over the Boardwalk outpost of G & P’s, now called Paul’s Daughter, so it looks like it will indeed be Goodbye to My Coney Island Equivalent of Proust’s Madeleine, barring a reprieve by a judge or the Mayor. Merde alors.

Our readers were equally unenthusiastic about a French multinational best known for running cafeterias for schools, corporations, hospitals, prisons and the military taking over the food operation at the People’s Playground and pushing out the indigenous Mom and Pops. “Sodexo was sub-contracted to handle all food & beverage services at the Fortune 50 corporation that I used to work for,” commented one of our readers. “In a nutshell, it is sterile, soul-less, generic food and beverage service.”

But that’s not why ATZ is unlikely to become a regular patron of the new Sodexo restaurant. As someone who works in Coney Island, we simply don’t have time or money to wait on line with the tourists. When we’re on the job, we brown bag it or a few of us will order from reasonably priced neighborhood places like Classic Heros and Pizza on the Run, which are just outside the amusement area. The prices at Luna Park’s Sodexo kiosks were on the high side for Coney Island. $5.00 plus tax for a cup of watermelon that could be bought for a couple of bucks from a vendor just down the block. $2.50 plus tax for a 20 ounce bottle of water which cost $2.00 in a vending machine across the street. Who’s pocketing the extra quarters and dollars?

Sodexo Kiosk at Luna Park Coney Island. May 31, 2010. Photo © Tricia Vita/me-myself-i via flickr

Ask New York City’s Economic Development Corporation, the secretive, quasi-governmental entity that is the City’s vehicle for promoting economic growth. It is the NYCEDC that made the 10-year contract with Zamperla for $100,000 annual rent plus a reported 10% of the gross in the first year of operation and pulls their strings like a puppeteer.

Interestingly, an Associated Press article about the eviction of the Boardwalk businesses misreported that the company is “paying the city $1 million plus part of gross receipts.” We got a laugh out of that, but the reporter can be forgiven for thinking the correct $100K figure was so paltry as to be a typo. To put this number in perspective, consider that Boardwalk businesses like Ruby’s and Cha Cha’s have been paying $100,000 annual rent in recent years. As for Luna Park’s second year of operation, including who stands to earn what from the Boardwalk leases and Sodexo’s cut, neither the NYCEDC nor Zamperla is saying, despite ATZ’s repeated requests.

Last year when the Coney Island Amusement Operator RFP was issued, NYCEDC disclosed to potential bidders that “While we cannot share information on individual licenses at this time, we can report that in the past, the gross potential rent for the Boardwalk tenants was approximately $750,000 to $900,000.” Considering that the property is City-owned and was purchased with $95.6 million of public funds, do you think this information is proprietary or public? We’ll let you know when we receive the results of our Freedom of Information Law (FOIL) request.

UPDATE March 31, 2013:

Surf’s Up for CAI Foods in Coney Island, Sodexo Is Out. Sodexo’s departure had long been rumored and is something to cheer about. According to the partnership agreement, after 3 years either party was free to terminate the lease, with CAI having to reimburse the remaining value of Sodexo’s initial investment, with interest.