Master Leaseholder Request For Proposal Issued For Roosevelt Island Main Street Retail Stores - Good Bye East Berlin, Hello 21st Century! Maybe

Main Street Image Of Roosevelt Island Is The Village From Glark

The Time has finally arrived. New ideas may soon be forthcoming to change the empty, dreary, depressing Prisoner and communist East Berlin like view and operation of Roosevelt Island's Main Street Retail corridor. Government, in the form of the Roosevelt Island Operating Corp. (RIOC) may finally be out of the business of retail management on Roosevelt Island.

The reason for this is that today, RIOC issued a Request For Proposals (RFP) for a private sector Master Leaseholder to take over the Roosevelt Island Main Street retail stores currently controlled by RIOC. RIOC Director Jonathan Kalkin Tweets:

My Master Lease RFP Roosevelt Island Retail Revitalization Initiative is LIVE today!

and:

Bye Gov't Run Commerce on Roosevelt Island. Hello Freedom, Hope, Choice, & Prosperity. RIOC Tear Down This Wall.

According to RIOC real estate consultant Jones Lang LaSalle:

On behalf of the Roosevelt Island Operating Corporation of the State of New York (“RIOC”), Jones Lang LaSalle (“JLL”) is seeking to leverage the expertise of the real estate industry to improve the community retail and services offered on Roosevelt Island (“RI”) through this request for proposals (“RFP”) from qualified investors and operators (“Investors” or “Proposers”) for the acquisition and management (the “Disposition”) of some or all of the retail and office space in the following six (6) buildings (the “Buildings”) located on Main Street, the primary north/south thoroughfare and the central retail corridor on RI (the “Retail Space”):

Below is the RFP for Roosevelt Island's Main Street retail portfolio.
RI Master Leaseholder RFP

Here are some highlights from the RFP (Page 2):

... RFP Goal: Through this RFP RIOC is seeking to maximize the best value for RIOC (“Best Value”), which is defined generally, and more specifically defined in the Selection Criteria, as the selection of a single Investor entity as master operator of the Retail Space or multiple Investors operating their respective Retail Units based on a proposal or proposals that:

(i) furthers RIOC’s objective of maximizing the long-term aggregate revenues RIOC receives from the Retail Space while

(ii) making available to RI’s residents, workers and visitors an improved and appropriate mix of goods and services;

(iii) improving the appearance and vibrancy of Main Street; and

(iv) maintaining quality operating and management standards for the Term of the transaction(s)

While the importance of maximizing RIOC’s revenues should not be understated, RIOC is seeking to encourage creativity and commitment on the part of the Investor(s) with this broader Goal of maximizing Best Value....

What does Best Value mean? According to the RFP (Page 10-11):

... In order to determine Best Value when evaluating RFP responses, RIOC will utilize the following Selection Criteria and weightings that, in its sole and absolute discretion are in the best interests of RIOC:

1. The total economic value and financial return to RIOC, which is defined as the present value of the risk adjusted economic value of the sum of: (i) upfront and future payments, (ii) the value of any in-kind considerations received by RIOC and (iii) the value of any other economic benefits received by RIOC. Any such in-kind consideration and or other economic benefits in (ii) and (iii) must be, in the sole judgment of RIOC, bona fide, legitimate, quantifiable and reasonable. (50%)

2. The proposer’s plans to improve the Retail Space or Retail Units including, but not limited to, marketing, design, operations, tenant mix and selection processes, approach to providing some space for non- profits, management, maintenance and renovation, including improving the Retail Spaces’ or the Retail Units’ relationship with its immediate surroundings and overall benefit to Roosevelt Island. (25%)

3. The experience, competence and commitment of the proposer (including the identity of the key employees and professionals the proposer intends to have work on the proposed project) in the re- development, management, marketing and leasing of projects that are similar in scale and complexity to that proposed under the RFP. (25%)...

Here are the available retail store spaces available for the Master Leaseholder (Page 14 of RFP).

Click On Image to Enlarge

Image of Roosevelt Island Main Street Corridor From Jones Lang LaSalle

For some reason, the Roosevelt Island Racquet Club Tennis Bubble at 281 Main Street is not included in this RFP.

It must be remembered that nothing in this RFP commits RIOC to accept any received proposals from potential private sector Main Street Retail Master Leaseholders. This is an information gathering process to determine whether there is any interest on the part of the real estate community to take over Roosevelt Island's Main Street retail corridor and if there is, RIOC will then have to make a determination if that is a good deal for Roosevelt Island.

For those interested in the process of how the Roosevelt Island Main Street Retail Master Leaseholder RFP was developed, below are links to RIOC Real Estate Development Committee audiocasts in which these issues were discussed.

6/10 RIOC Real Estate Development Committee audiocast

5/25 RIOC Real Estate Development Committee audiocast

5/17 RIOC Real Estate Development Committee audiocast

4/27 RIOC Real Estate Development Committee audiocast

Great job by Mr. Kalkin and the RIOC Board of Directors in getting this through. Now let's see what happens.

UPDATE 9/2 - Neglected to mention that proposals are due October 13 2010.

UPDATE 9/5 - RIOC has also posted links to audiocasts of Master Leaseholder related Real Estate Committee meetings.