Sunday, August 5, 2007

Master Leaseholder for Main Street Retail?


A member of RIRA Common Council proposes that a private real estate firm become the Master Leaseholder for the Roosevelt Island Main Street retail space. The Master Leasehlolder form of ownership may end the blight of empty storefronts, such as the former Pizza and Bakery, by removing obstacles to leasing commercial space from RIOC resulting from restrictions placed on RIOC due to the 2005 Public Authorities Act.
As outlined in the Main Street Wire:

Our solution is simple: We lease the commercial space to a master leaseholder who then sublets the individual storefronts. You’ve heard this approach before, but we added a few restrictions that will give the Roosevelt Island public a role and a voice: An advisory group of residents will help the leaseholder decide what kind of stores, restaurants, and services we need.

I see a potential problem with the idea of a Master Leaseholder. I believe that, excluding the occupied Gristedes space, there is approximately only 40,000 square feet of Main Street retail space controlled by RIOC. That may not be a large enough inventory of leasable space to interest a well qualified real estate management company to own and or manage. I recall that Jones Lang LaSalle put out a Request for Proposal for a Master Leaseholder for the Main Street retail space and nothing came of it.

2 comments :

No Room on the F Train, Sucka said...

Nice little blog here. Saw your sign on the kiosk outside the Gristedes. Keep it coming.

Jonathan said...

I wrote the article you posted. Actually lack of interest is a myth. I have spent the whole summer finding someone to take over these storefronts. I have up to three developers very interested, but no RFP has been placed yet. There is about 40,000 sqft empty and 90,000 in total, which could be taken over by a master leaseholder on a rolling basis. It’s just a matter of giving notice to the current tenants of their new landlord. I have talked to all the parties involved and RIOC simply has to put out an RFP so I can bring these developers to bid. There are bidders willing to spend millions to refurbish the storefronts with a small rate of return. I am also working with state government to help move this forward. The problem before was the public wasn’t behind it and no one took the initiative to find people. I have spent a lot of time on this and it looks like it’s working its way there. Also, it helps that I have no financial stake in it other than I live here and would love to see some real progress. It sounds simple, but I love this island and it was easy to convince others to see this as an opportunity because I was so passionate about its greatness. Shane said they are thinking about how to do a proper RFP. I believe he has the best interest of everyone in mind. This problem will be solved with the public’s support. Great blog. Keep up the good work! If you need more info, feel free to contact me.

Jonathan M. Kalkin
RIRA Common Council