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December 8, 2015- by Steven E. Greer
During the December 4th BPCA board meeting, the board voted to approve a strange new lease with Mariners Cove Site B Associates (“Mariners”), the corporate entity that owns the residential apartment building at 200 Rector Place. The BPCA’s facility expert, Gwen Dawson, made very vague references as to the necessity of this new lease of an office space on the east side of 200 Rector Place (see video).
She explained that the 7,000-sq-ft of office space for the parks conservancy at the Regatta on 21 South End Ave, which was emptied in 2010 when the new parks conservancy office opened on Battery Place, has still been rented by the BPCA for approximately $500,000 per year. However, Dawson was unable to justify that ongoing expenditure.
She stated in her presentation, “Our needs for the space have varied over time. However, we maintained the space because it was first floor location as well as….was particularly well suited for the functions that we needed to have operate there.”.
Since the parks conservancy and PEP office have both moved out of 21 South End Avenue more than five years ago, and the space has been virtually empty since then, what “functions” she was referring to are unknown.
Dawson proceeded to say, “And we were also limited by a dearth of…ugh…options in the…ugh…neighborhood that would be suitable for that kind of function….and this space came available because it had been previously occupied by the contractor for the State DOT on Route 9a work as a construction field office. It is…ugh…certainly…ugh… adaptable for our purposes.”.
Again, what “purposes” those were remain a complete mystery. Moreover, this office space at 200 Rector Place has been empty for years. This is not some new opportunity that the BPCA is jumping on to reduce costs. The timing of it all is very suspicious.
Dawson continued, “It’s a little over $70 a square foot. And then we will be looking at an escalation after this year.”.
Then, Chairman and CEO Dennis Mehiel stated, “You have about a half a million dollars rent that you will be taking to $180,00 to $190,000. Questions? Any members?”. Then, the resolution was approved.
What makes this whole matter of great interest is that Mariners is owned by three different investment partners. Howard Milstein is one of them and has been the managing partner since the building was constructed in the 1980’s. However, this year, his other two partners sued to remove him as the managing partner. A Supreme Court judge ruled in their favor and the matter is under appeal.
Also, Mariners, Milstein, and the BPCA are all co-defendants in a federal lawsuit. The suit alleges that the three defendants colluded and conspired in an illegal action. The legal defense cost to Mariners and Milstein is likely in the six-figures.
With state money from the BPCA being transferred into a large fungible pool of cash controlled by Mariners, one must ask whether those funds from this dubious new lease, for unnecessary space, are actually being used by Mariners to cover the legal costs of the federal lawsuit. One would also be justified in asking the specific need for the space being leased, since the BPCA currently has ample space for community events at 6 River Terrace, the PEP office, the Poet’s House, and other locations. Which BPCA officer drove this deal, etc.?