Riverhead Advancing EPCAL Sale
By Rick Murphy
The Town of Riverhead seems intent — and content — to move forward with a deal in place to sell Enterprise Park at Calverton acreage despite persistent warnings from community and environmental groups opposed to the deal.
There is renewed consternation about the purchasers, the Ghermezian family, primarily because the source of their financing is malls, and malls have been shuttered across much of the country because of the COVID-19 pandemic.
But Calverton Aviation & Technology, doing business as Triple Five Group, put together by the Ghermezian family, apparently met a town-imposed deadline for furnishing financial data before May 22. It apparently produced an income stream that satisfied the town.
“Today, CAT provided Midnight Capital’s ‘Letter of Interest for an Industrial Construction Loan’ citing purpose of loan for construction of 1,000,000 square feet of industrial development, together with a letter from Arieli Capital expressing interest in joining Triple Five, and lending its financial strength and investment expertise to CAT’s planning and construction and development at EPCAL,” wrote Riverhead Town Supervisor Yvette Aguiar. “The town appreciates CAT’s timely and voluntary submission of these documents and the town board will immediately begin a thorough review of these records.”
Rex Farr, coordinator of the EPCAL Watch Coalition, is urging Aguiar to “seize the opportunity to free the town from a very bad deal.”
Farr’s group represents scores of citizen and environmental groups that oppose the $40-million deal for 1660 acres with some 1000 acres to be held in reserve, and has thousands of signatures on a petition urging the town to break the deal. This week, Farr provided new fodder: a series of documents showing the mall business that is the bread and butter of the Ghermezian business empire in serious debt.
The Mall of America, owned by Triple Five Group, is delinquent on its $1.4 billion mortgage, according to published reports.
Triple Five missed its April and May payments, according to a May 20 report in the Financial Times, citing documents prepared by Wells Fargo & Company, the trustee of the debt and the master servicer for the loan. The borrower notified Wells Fargo of “COVID-19-related hardships,” according to a May 21 Bloomberg report.
The mall, a more than two-million-square-foot complex in Bloomington, MN and the largest mall in the United States, has been shuttered since March 17. It is planning to reopen June 1.
Triple Five asked Minnesota officials for relief last month and a proposal to allow forgivable loans from special tax funds is pending in the state legislature. Bloomington city officials oppose the proposed legislation. The city manager wrote in a May 12 letter to state lawmakers: “We simply have no assurance or confidence that a loan will help the long-term viability of the project.”
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