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Developer buys RKO Keith’s

The landmarked RKO Keith’s Theatre in Flushing has sold for $20 million to Manhattan condominium developer Patrick Thompson, the attorney who represented Thompson in the deal said Tuesday.

Thompson has yet to decide what he plans to do with the property, which has fallen into disrepair in recent years, but he is considering building a nursing home or condos on the site, according to Craig L. Price, of the Manhattan law firm Belkin Burden Wenig & Goldman.

“Right now he hasn’t determined what his final plan is going to be,” Price said. “He’s taking his time to figure out what would be best for the site.”

Thompson purchased the theater from Doral Bank, which holds the $20 million mortgage taken out by its former owner, Shaya Boymelgreen, who has descended into financial woes in recent years, and defaulted on the loan, according to Price.

Doral first indicated publicly that the bank was in negotiations to sell the note in October 2009.

Thompson, who has developed a number of condo projects in Manhattan, said he believes he can build up to a 389,000-square-foot building at the site, but that he will also comply with landmark law and renovate, repair and maintain the landmarked lobby, according to Price.

“He’s done this before,” Price said. “He’s successfully navigated the New York City marketplace and he’s ready to work to restore [RKO Keith’s] to its former glory for the Flushing community.”

Vacant since 1986, the theater, which serves as the western anchor of downtown Flushing at the intersection of Main Street and Northern Boulevard, has been a controversial site for years.

Rick Gallo, a co-organizer of Save the RKO Keith’s, a community group started last year to fight against the redevelopment of RKO Keith’s, said Tuesday he was “flabbergasted” the site has been sold to Thompson.

“If he’s going to tear everything down and put up co-ops, it would be a travesty, but if he builds around it or puts in some kind of performing arts center or something, that would be great. A little bit of Flushing would get preserved,” Gallo said.

In 1999 notorious developer Tommy Huang pleaded guilty to felony charges for ignoring asbestos contamination and pouring hundreds of gallons of fuel oil in the theater’s basement two decades ago. He was ordered to pay a $5,000 fine and sentenced to five years’ probation.

Boymelgreen purchased the theater in 2002 and attempted to develop the long-neglected site at 137-25 Northern Blvd. Plans were approved to turn the theater into a 17-story condo tower with a senior center in 2005.

The plans called for the construction of 200 apartments, 229 parking spaces, a senior center and the restoration of the landmarked lobby to preserve the theater’s history, but they were stalled when Boymelgreen said the project would not be financially viable if certain changes were not made.

Boymelgreen, whose company was evicted earlier this year from its Brooklyn headquarters for not paying rent, put the project up for sale in 2007 for $24 million, but was unable to find a buyer at that price level.

Reach reporter Connor Adams Sheets by e-mail at csheets@cnglocal.com or by phone at 718-260-4538.

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