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Developer cries foul over Coliseum lease.

Claiming its bottom line is more important than what might be good for the city's economy, the MTA is "leaning" towards a proposal by a Canadian film company to create studios from the vacant Coliseum exhibit space.

Meanwhile, the former head of the Javits Convention Center says his proposal to use the Coliseum as convention space would add millions of dollars and thousands of jobs to the economy but is being thwarted by his nemesis and replacement at the Javits Center.

The Metropolitan Transit Authority has moved to lease the Coliseum space, at 59th Street and Columbus Circle, because Mortimer Zuckerman's Columbus Center project is held up in court.

"He's drummed up some numbers and is trying to create a controversy where none exists," said MTA spokesperson Tito Davila of the proposal and charges of former Javits Center head Thomas F. Galvin. "The way we approached (the proposals) is the use to the Coliseum, and what would generate the most money for the transit system."

Galvin points to the public good and says "the significant benefits to the city and state would not be attainable by (renting to the film studio) and would not be in the best interests of the city and state."

While no decision is expected to be reached until later in the spring, Davila explained they are leaning towards the movie company "because they are making an attractive offer but we haven't made a recommendation yet." Davila declined to reveal the spread between the proposals or any other financial details.

The MTA received two suitable responses to its RFP. One came from the Canadian movie company, SKYLD of Toronto, headed by Jim Penturn, which would like to turn the convention space into a movie and television studio and rent it out. Davila said the film company would renovate the space itself and act as managing agent for the offices and the building's garage.

The other proposal came from Galvin and his partner T'ing Pei--the eldest son of I.M.Pei-- who proposed using the space for that it was created for-conventions. Galvin said they would also spend $2 million to fix salt decay which currently limits 75 percent of the garage use and would rent out the remaining office space.

Any lease for the property would be for five years, however, Davila said, it would contain a 30-day cancellation clause, just in case the Coliseum Center construction can go forward. It makes sense to utilize the building, Davila said. "It's an ideal location and we might as well have it producing revenue," he added.

Galvin claims his proposal will draw multi-millions into the City's economy as conventioneers use area hotels and restaurants, while jobs would be created for those who would work in the space. Galvin says he has the support of labor unions, hotels and even Ruth Messinger, Manhattan borough president.

Messinger's Spokesman Andrew Breslau said it is too early to support any proposal and there also has to be an economic study done to determine the proposals' impact. They do have questions about the economic arrangements and have sent a letter to Peter Stengel, head of the MTA, but have not received a response.

Galvin also claims current Javits Center President and CEO Fabian G. Palomino exerted influence over the MTA because among other things, another convention site would take revenues from the Javits Center.

"It is absolutely not true," said Mike Eisgrau a spokesperson for the Javits Center. "Mr. Palomino said this is definitely not true and his public position all along has been that he's been in favor of shows at the Coliseum.

Eisgrau said Palomino "never objected to Tom Galvin's involvement with the Coliseum and told the union leadership he same thing."

Jack Dolan, a union coordinator who was present at the meeting with Palomino confirms his comments. "We asked him if he was opposed to the redevelopment of the Coliseum and he said no," he said. "When we mentioned various names he wasn't opposed to those names. He said he was 'in favor of anybody but Galvin'. He said he would be opposed to any project that Tom Galvin was involved in. He said it was personal and repeated this two or three times. You can see its a personal disagreement."

There is also a great deal of past animosity between the men. Palomino, a friend of Governor Mario Cuomo, replaced Galvin as the head of Javits after he had helped construct it and two weeks after it opened. The men had previously clashed over the marketing direction for the facility.

Galvin charges the current marketing direction, led by Palomino, is taking the Javits Center toward presenting more public shows, which draw only from the local area, and is holding fewer conventions that use hotel rooms and add other tourist dollars to the economy.

Eisgrau provided figures that do not support this charge. Javits has booked nearly 100 shows this year, with a total of almost 825 over the six years. Of those, 708 were trade shows. "This is essentially a trade show operation," said Eisgrau.

Dolan blames the slackening of Javits shows on "mismanagement," and said the premise of the Javits Center was not to do any trade shows at all. "Now while every convention center in the country is increasing (business) by 50 percent, all New York is doing is losing business," he said. They go to the Meadowlands rather than go into the convention Center. Dolan said everybody from management blames the labor unions for the lack of business. Labor has bent over backwards to encourage business.

Galvin said he was also pressured by the MTA not to use his sublicensee, AETEC Corp. because, he said, the company, which runs international conventions, had a dispute with the Javits Center and Palomino. Eisgrau said he did not know about AETEC and declined to comment.

"It's irresponsible for a public agency (not to consider the economic impact of the proposal)," Pei noted. "These people are taking such a narrow view that cannot be justified.'
COPYRIGHT 1992 Hagedorn Publication
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Copyright 1992, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Title Annotation:Thomas F. Galvin
Author:Weiss, Lois
Publication:Real Estate Weekly
Date:Feb 26, 1992
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