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[POLL] Let's Make a Deal for Lester's, Rye Council Mulls Offer

City Council to mull acceptance of Lester's right of first refusal offer on 1037 Boston Post Road property.

 

After several weeks of discussion in executive session, Rye council members will take up a sale agreement for a commercial property at 1037 Boston Post Road during its regular session tonight. Lester's of Rye LLC- the current occupant of the building- has made a purchase offer of $3,600,000.

Lester's has a so-called "right of first refusal" to negotiate purchase with the city. Under the terms of the proposed sale agreement, the city will solicit additional offers until September 11, 2012. If the city receives a greater offer, it will give current tenant Lester's, a chance to match that price.

Facts about 1037 Boston Post Road

  • Lester's lease agreement expires on November 30, 2013. It currently pays the city $24,262 per month.
  • The building is 9,600 square feet and sits on a 0.69 acre parcel of land.
  • The site, a former car dealership, was purchased by the city on May 1, 2006 for $6.2 million for use as a proposed police/court complex. That project was later deemed too costly to undertake.
  • The city's assessor records the value of the building at $4,486,111
  • The sales agreement includes an agreement to allow the city use of 10 parking spaces behind the building for "officers, officials and employees" on weekdays between 9 a.m. to 12 p.m.

"Valuing the property is all about the rent that the building does or could produce," said broker Ann K. Silver, associate director of Rand Commercial Services in White Plains. "This is a very well located property even though it is just outside the heart of the Rye Central Business District."

Silver also said, "There is really nothing in Rye for sale comparable to the property." 

 

RyeDad July 11, 2012 at 02:12 PM
Doug "Monty Hall" French and Peter "Wayne Brady" Jovanovich are trying to get the public to pick what is behind door #2 when we already "Won" this $6.5 million piece of property in a previous Steve Otis led showcase. Don't let Doug "Monty Hall" French and Peter "Wayne Brady" Jovanovich "Zonk" us by giving away our property for $3.6 million. By the way where is the recent appraisal for this building? Why are Pickup, French and Jovanovich illegally keeping it under wraps until after the sale goes through? Are the people who own Lesters politically connected? If they do sell this building for $3,600,000, I think the Attorney General should investigate the entire process of buying, leasing, re-leasing and selling it at a taxpayer funded $2,600,000 loss. Anyone know why the City Comptroller quit on the same night the 2011 audit was made public? I didn't see any explanation in Monty's Mayoral update. Anyone see the 2011 City of Rye Annual Report that, according to the City of Rye Charter, had to be completed and posted by February 29, 2012? Are the rumors that Pickup is leaving in August true? Will he be selling his house located on the Theall Road south extension?
Brook Packard July 11, 2012 at 02:24 PM
It would be prudent to ask whatever business occupying 1037 Boston Post Road to give back to the community in ways other than rent. Early on in Lester's tenure, there was no parking spaces available for the Rye Free Reading Room. I pulled into the empty parking lot adjacent to Lester's intending to peruse the store after I had done my errands. As I locked my car, I was confronted by a manager who told me that unless I planned on going straight into Lester's and only Lester's he would have my car towed. Needless to say I have found other places to shop over the years and never set foot in the store. A little good will towards the community whose business you're seeking goes a long way.
tedc July 11, 2012 at 02:26 PM
RYE CITY’S NEW SECRET APPRAISAL? LARGEST UNRECOVERABLE LOSS OF TAXPAYER FUNDS COMES EVER CLOSER. June 13th Rye City Council Meeting – Item 14 – time code 3.11 – http://ryeny.swagit.com/play/06132012-688 Councilwoman Brett - “there was an appraisal done on the property and it’s (the Lester’s offer) within the range that the appraisal came in at.” But the city council never released this document in the month thereafter and then when this so called “appraisal was “FOIL”-ed for on June 21th – city officials responded 3 days later as follows: “In response to your FOIL request, attached find 2006 appraisal for 1037 Boston Post Road. An additional document is exempt as an inter-agency document under Public Officers Law Section 87(2)(g). You have the right to appeal this response to the Corporation Counsel within ten business days.” CLAIMS OF TRANSPARENT SALE PROCESS OUT THE WINDOW? WHO’S BENEFITING?
Lola La Va July 16, 2012 at 12:49 AM
I thought this used to be a CVS in the 90s. Don't remember a car dealership. A 2006 appraisal? I think a more recent one is in order.
John Smith July 18, 2012 at 06:15 PM
Let's look at the economics of this. Rye City gets almost $300k/yr rent. A private owner might look at it as $250k (i.e. property taxes). Publicly traded REITs trade at < 5% cap rate, but lets use 5%. That would value this property at $5mm (4% would be $6.25mm). Given scarcity of land in Rye, low yields in investments everywhere else and potential to increase rent /other uses, why not just keep it? On a related note, did anyone else notice from the town minutes that we could outsource muni garbage collection to private haulers and save $2.4 million / yr? (Muni employeed garbage men make $106k + very good benefits that will likely cost $$$ in pension over time)
John Smith July 18, 2012 at 06:25 PM
The other problem with the way the lease is structured is that it gives Lesters the right of first refusal - which means that other bidders are less likely to bid (they can do the work, then just have Lesters match the bid). The City should resign the lease and get rid of the right of first refusal, then do a real sales process to get fair value
ament3charles@aol.com October 22, 2012 at 03:39 AM
Governments must be run like a business , they are entrusted to "do the peoples business" no one buys high sells low and stays in business. Charles E. Ament

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