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Medley developer sues bank
Irondequoit, N.Y. -- As the May 1 deadline looms for the Medley Centre to potentially lose its tax breaks, mall owners are now blaming the bank for delays in the project.
Bersin Properties, LLC, owner of the Medley Centre, is suing Nomura Holdings, a Japanese bank, for $100 million. Medley's owners claimed the bank went back on its promise to help finance the project.
The complaint filed on Friday details the actions of the bank in 2008 and 2009 that Bersin Properties claimed caused a planned construction schedule to be postponed and impacted the ability of the developer to begin construction.
Scott Congel, Bersin's managing partner, said the bank "crushed the project" by withdrawing funding and said he is relieved to finally be able to tell taxpayers and the community the real cause of the delay.
Congel maintained his primary objective is to move ahead with the project to redevelop the abandoned mall into a premier tourism resort. Bersin Properties is now suing Nomura Credit for $100 million.
On Thursday, Bersin Properties faces a deadline to pay $3.8 million owed under a payment-in-lieu-of-taxes agreement. If missed, Medley developers could lose their tax breaks.
Arnie Rothschild of the Rochester Broadway Theater League said this isn't a stall tactic.
Rothschild said this lawsuit is something that has been looming but said developers couldn't talk about it because they were trying to negotiate with the bank to try and get them to release the lien.
Stakeholdlers who agreed to tax-breaks for Medley said this doesn't change anything as far as they're concerned. They said if Congel doesn't pay up what he owes by May 1, they will ask the County of Monroe Industrial Development Agency (COMIDA) to terminate tax breaks.
SUPERVISOR BELLO STATEMENT REGARDING BERSIN PROPERTIES' NOMURA LAWSUIT:
In February, the Town of Irondequoit, East Irondequoit Central School District, and COMIDA notified Bersin Properties that it was past due in making required PILOT payments, and if the payments were not received by May 1st, the PILOT agreement would be terminated. Legal action by Bersin Properties against its creditors does not relieve their obligation to the taxpayers of Irondequoit.
Irondequoit residents have been patient for too long, and are rightfully frustrated by the lack of development. In fact, today's actions raise further concerns regarding the viability of the project.
Therefore, failure to make full payment by May 1st, regardless of any outside events, will result in action by the Town of Irondequoit and the affected tax jurisdictions to terminate the PILOT agreement.
East Irondequoit's statement on lawsuit:
We have read the Summons and Complaint filed by Bersin Properties against its lender. This action comes as no surprise to us since the developer has discussed this as a possibility for quite some time.
The school district requires that the developer honor the existing PILOT agreement. Nothing in the action against the lender changes this. We have made it clear that money owed to us under terms of the agreement by paid by May 1st. If payment is not received we will request that COMIDA terminate the agreement.