Sale of air rights save theater, make development possible.

A new luxury condominium will rise in the East Village will save a theater and create 37 new condominiums, after Jerry Rosengarten and Michael Waldman, the developers, helped craft a deal that to purchase air rights to The Theater for the New City from the city, along with a small portion of its lobby and storage areas.

The deal allowed them to build a new condominium building over a portion of the current structure at 10th Street and First Avenue, and create a new residential lobby at 240 East 10th Street.

This is the fourth location for the theater company, which hosted the kickoff of the Greenwich Village Halloween Parade at an earlier spot on Jane Street.

The Theater for the New City purchased its current building from New York City for $717,000 in 1986 with a downpayment of $71,000 "and a very large mortgage," said Crystal Field, the company director. They expanded and renovated, but after a disagreement with the contractor, were facing over $550,000 in liens and interest due.

The city had never allowed them to purchase the air rights, however, and this new fiscal rescue and development relied on that sale.

Rosengarten helped them design the plan which brings the theater an additional $100,000 towards its mortgage.

"We found the developer and they paid the lien," said Field. "It's wonderful."

Now, after winning the RFP issued by the New York City Economic Development Corp., the steel is rising and pre-sales are beginning through Douglas Elliman.

"The theaters will stay intact and a building will go on top," said Louise Phillips vice president of Douglas Elliman, which will be marketing the units.

Because the theaters have to keep operating during construction, there are only small windows of opportunity between productions to do some of the preliminary construction work.

"We did a very surgical design," said Rosengarten. They had to go through portions of the building, and a concrete and steel mat was installed the basement to support the steel for the new structure.

By June, the steel is expected to be topped out, and the condos should be ready by June 2001. Designed by Schuman Lichtenstein Claman, the construction team includes New York Construction Collaborative, LLC, with structural engineer Rodney Gibble and mechanical engineer Abe Joslow.

The new condominium will have a 24-hour doorman, and 34 of the 37 units will have some kind of outdoor terrace. "Every apartment has from two to three exposures," says Phillips. The units will also have nine-foot ceilings with double height ceilings in the penthouses.

Since surrounding buildings are short and this tower will rise about 17 stories, the units are expected to have marvelous views.

Typical of the latest in luxury construction, the open loft kitchens will have stainless steel appliances and stone countertops.

Pre-construction sales begin this week off floor plans and are expected to garner about $500 a foot. Because the building qualifies for a 421 a abatement, carrying costs are expected to be about 50 cents a foot, said Phillips.

While Field doesn't think the area's residents will end up moving to the new condos, she is grateful no cultural institutions or residents are being displaced by the new development. "I feel that lovely people will move in," she said.

This weekend, the Theater for the New City hosts the free Lower East Side Festival of the Arts. There will be events all day outside on Friday, May 26th while each night, there are theater, dance, music, and poetry performances. James Earl Jones and David Armram will speak and perform respectively, beginning at 8 p.m. on Friday night. On Saturday night there are film screenings, and on Sunday night from 5 to 7 p.m., 30 poets will be reading from their works before the other theatrical events.

"If more and more situations can evolve developers contributing to the arts, we'd all be better off," said Rosengarten.