Complications with a primary lender could threaten the construction of Muss Development’s Sky View Parc on College Point Boulevard, according to sources familiar with the planned Flushing megacomplex.
Arbor Realty Trust, which agreed to loan Muss approximately $75 million for construction of the project, has not paid advances on its loan for the last two months, leaving the Forest Hills-based developer to put up nearly $4 million itself, sources said. The situation could threaten the continued construction of the project, which has been ongoing since 2007, if it is not resolved soon, the sources said.
In a statement, Muss Development said the project to this point has been a success and it is actively working to fix the lending snafu.
“Sky View Parc is a dynamic development for Flushing, Queens and New York City. It has been successful by every measure, notwithstanding these challenging economic times. We continue our efforts with our partners and senior lenders to resolve issues that are not of our making,” the statement read.
In a statement, Arbor refuted the claims, contending that the firm was “in full compliance with its obligations under the applicable agreements.”
“In particular, Arbor has provided all of the financing for which the appropriate conditions are satisfied,” the statement read.
The issue will probably come to a head soon since Arbor’s monthly advance is due by the end of this week.
Arbor has seen its own share of development troubles recently. The financial trust was a primary lender at the residential project on 51st Street in Manhattan where a crane collapsed in March, killing seven people and indefinitely halting work at the site.
Sky View Parc is currently the largest project under construction in Flushing and if completed would include 448 luxury apartments built atop a sprawling retail complex. Settling the lending dispute is critical for Muss because purchase agreements have been signed for about 30 percent of the 448 housing units and more than 70 percent of the retail space.
City Councilman John Liu (D-Flushing) said he is not overly concerned about the lending dispute.
“I have every confidence that they will be able to weather these troubled times,” he said. “Times are difficult and speculators feel the most pain, but the Muss organization is in no way speculative.”
Construction on the project has been steady and the development is hard to miss along College Point Boulevard. Two residential towers have already risen over 15 stories and work on the retail center that sits at the base of the project is nearing completion.
A spokesman for Muss said as of press time the project remained on schedule and the first apartments along with the retail center could open as early as this summer.
Any stall in construction could delay the move-in dates for more than a 130 potential tenants and dozens of retailers, including Home Depot, Marshalls and Bed Bath & Beyond, each of which were expecting to be settled in the complex within the next six to eight months.
Muss Development is a Forest Hills-based, family-owned development firm founded in 1906. The firm is one of the largest in the city and has led the construction of thousands of housing units and developments in the five boroughs during the last century.
Reach reporter Stephen Stirling by e-mail at firstname.lastname@example.org or by phone at 718-229-0300, Ext. 138.
©2009 Community News Group
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