RYE, N.Y. The Rye City Council tabled Wednesday evening the passing of a memorandum that would have given City Manager Scott Pickup authorization to offer Lester's Clothing Store the right of first refusal on the city-owned building the store currently occupies.
The Rye City's Corporation Counsel member Kristen Wilson said recent amendments to the agreement changed it from a memorandum to a purchase and sale agreement, which was part of the reason why the council tabled the matter. Since it is a real estate matter, the council elected to move to executive session to discuss the issue.
City Manager Scott Pickup said the building, which is next to city hall, was purchased back in 2006 for $6.2 million under the administration of former Mayor Steve Otis with the intention of transforming it into a new police headquarters.
"At the time there was a discussion to look at a new police building," Pickup said. "The council determined the Lester's building would make sense because it would be part of the citys campus."
After the economic downturn, the city tabled plans for redevelopment and rented the property to Lester's. Pickup said that after further in depth analysis, the city ultimately determined that the building wasn't fit to house police headquarters.
"Nobody had any idea what would happen with the market," Pickup said. "I think if we had a crystal ball we wouldn't have gone forward at that point. Timing, what else can you say?"
The city recently completed the payment plan on the property, which included a $5 million balloon payment. Pickup said the remaining $1.2 million that was paid incrementally was offset by rent collected.
Wilson said the city, due to the leasing agreement with Lester's, is up against a February 2013 deadline to make a determination on the property. Pickup said that the rent collected from Lester's has impacts on the city's budget.
"At some point it has a revenue impact in 2013 and beyond," Pickup said.
Pickup added that the next likely action and public discourse on the property would be at the city council's May 9 meeting.
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