KNIC keeps fighting following filed lawsuit

Following the filing of a lawsuit over the stalled Kingsbridge Armory project, developers and their representatives are fighting for what is rightfully theirs.

A lawsuit was filed against Mayor de Blasio and the NYC Economic Development Corporation over the Kingsbridge National Ice Center project delay.

Following the lawsuit filing on Tuesday, April 12, KNIC wrote a letter to Alicia Glenn, deputy mayor for NYC Housing and Economic Development, which stated KNIC’s disappointment in her office as well as the mayor’s administration for attempting to compromise with KNIC after an agreement and commitment on the project had already been reached.

“To be clear, KNIC has satisfied the terms of the escrow agreement imposed upon the company,” said Mark Messier, KNIC’s CEO, in his letter to Glen. “KNIC is, therefore, entitled to the executed lease (currently held in escrow) – and the community is entitled to all of the opportunities and benefits which will flow from our project.”

“You (the city) stated that before EDC would release the signed documents currently held in escrow, but instead, you later stated that there must be material changes to the terms of the lease held in escrow before these documents can be released,” Messier added. “This, of course, will result in yet more delays and prevents KNIC from commencing construction upon taking possession of the facility and severely hinders KNIC’s ability to secure mortages.”

“Our client (KNIC) has satisfied the terms of the escrow agreement and wants the lease that has been previously agreed upon by both parties,” said William Brewer III, partner at Brewer, Attorneys & Counselors, who represents KNIC. “We reject any offer that limits our ability to begin construction or restricts the ability to record a mortgage agains the lease, as those conditions will have a crippling effect on our ability to move forward and create new jobs.”

“The city still has not responded to KNIC’s most recent communication hoping to resolve this issue – or responded to the substance of the lawsuit filed by KNIC,” Brewer III added. “We will seek an order from the court declaring the EDC’s objection to delivery of the signed lease as inappropriate.”

The 35-page lawsuit’s actions came up after the mayor’s determination to violate a 99-year lease contract entered during previous Mayor Michael Bloomberg’s administration.

The lawsuit also states that Mayor de Blasio’s administration has diverted the rightful owner from their business opportunity while also ‘deliberately delaying the process of the Kingsbridge Armory redevelopment’, which has caused KNIC hundreds of millions of dollars in losses.

The suit even alleges that NYCEDC had conspired with the project’s former principals, Jonathon Richter, Jeff Spiritos and Marcos Wignell, in hopes that KNIC would default on its commitment so that the project’s responsibility could be passed back over to the three individuals who used to handle the site’s development.

The financial process for the project began in December, when the first $20 million in private funding of the $138 million construction loan commitment was approved by the Empire State Development Corporation’s board of directors. In February, ESD also approved a $15 million construction loan (of $158 million) to be used towards phase one of the Kingsbridge Armory renovations.

“Our hope is that the city will immediately withdraw its objection to the continued progress of the Kingsbridge Armory redevelopment,” Messier said. “Any modification to the current lease arrangements will impede the forward momentum of this project, stall the creation of new jobs and delay the delivery of benefits to which the community is entitled.”

Reach Reporter Steven Goodstein at (718) 260-4599. E-mail him at sgoodstein@cnglocal.com.

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