Old article, another old version...
Cappelli seeks to expand towers at LeCount Square
Louis R. Cappelli wants to build five additional stories for both of the apartment towers proposed as part of his $500 million LeCount Square mixed-use project for downtown New Rochelle.
By ALEX PHILIPPIDIS
October 23, 2006
Louis R. Cappelli expected to spend $12 million for the parcels that comprise a downtown New Rochelle block where he has proposed his $500 million LeCount Square mixed-use project.
Instead, he shelled out more than $32 million.
So eager was the Valhalla developer to make deals that sellers drove prices higher. Among them were Anthony and Frank Longhitano, a pair of brother developers with whom Cappelli had squabbled over this and some of his other projects. The Longhitanos received almost $7 million from Cappelli for their 15,000-square-foot 15-21 Anderson St., a commercial “taxpayer” property appraised at $1.9 million, said Joseph V. Apicella, senior vice president with Cappelli Enterprises Inc.
Cappelli Enterprises cites its acquisition expenses, plus a three-year spike in construction costs, as reasons why it wants New Rochelle officials to approve 10 more stories for each of the two apartment towers Cappelli plans for LeCount Square.
“This is to compensate for not being able to acquire the site at fair-market price,” Apicella said. “In order to avoid eminent domain, we paid well over three times the appraised value on these sites. It cost over $32 million to assemble 2.2 acres.”
He said Cappelli sought to avoid a repeat of 2000-01, when the city took steps toward eminent domain land acquisitions for an Ikea store only to stoke opposition that eventually killed the plan.
Apicella disclosed Cappelli’s desire to expand LeCount Square during an Oct. 12 address to the Commercial & Investment Division of the Westchester County Board of Realtors, held at the board’s White Plains offices.
Cappelli now wants to build two towers 500-feet tall, roughly 50 stories. Until now, the developer’s plans for LeCount Square have called for two 390-foot towers above a three-story retail “podium.”
Additional stories would increase the project density above the current 1.1 million square feet -- containing 371 dwelling units, 180,917 square feet of retail space, 21,560 square feet of restaurant space, a 172-key hotel with unspecified number of residences, and 189,924 square feet of office space.
The project would also include a rooftop garden open to the public with a cafe and restaurant intended to draw patrons through panoramic views of Long Island Sound.
LeCount Square would rise on a city block bordered by LeCount Place, Anderson and Huguenot streets and North Avenue. One current building on the block would be preserved -- the main New Rochelle post office at 255 North Ave., completed in 1937, though the U.S. Postal Service would move its trucks off the block.
Cappelli Enterprises hopes to break ground on the project in April 2007, with the first occupants moving into the apartments by April 2010.
At deadline, Cappelli had not made a formal request of the council to amend its original development application, New Rochelle Mayor Noam Branson said.
“They have approached us informally,” Bramson said. “Our response has been to require additional information -- a justification. We’re still in an information-gathering mode now.”
Cappelli hopes New Rochelle officials will be as amenable to expanding one of his projects as their counterparts in White Plains were last year when they approved five additional stories for the twin towers of his $400 million Renaissance Square hotel-apartment-retail complex, now under construction.
LeCount Square’s current plan has become unfeasible as Cappelli’s development costs have multiplied, Apicella told the real estate group. He cited regional construction costs that have risen as much as 25 percent over the past three years, but said that wasn’t why the developer is seeking a larger project.
“When you’re 16, 17, 18 million dollars over your budget (because) you thought your acquisition price was $12 million … I have to go back to the municipality and say, ‘Let’s creatively try to solve this without hurting you and without hurting me. Otherwise you have a slowdown on the job. It doesn’t move forward. And that’s not in your best interest, certainly not in mine,’” Apicella said.
Westchester construction costs are influenced by New York City, where a New York Building Congress study released earlier this month concluded those costs will exceed last year’s by nearly 11 percent, and are growing at a rate of 1 percent per month.
The construction cost spike was successfully cited earlier this year by another Westchester developer, Martin Ginsburg, to win approvals for a denser urban project in White Plains. Ginsburg and Manhattan builder A.J. Rotunde received a green light to add 32 units and five stories to their $200 million project The Pinnacle, resulting in a luxury condo building of 28 stories and 171 units.
TARGET, STARWOOD TALKS
Apicella said Cappelli is in talks with Target as the project’s retail anchor. Big-box retailers like Target would be located in the second and third levels of the retail podium, with the street level reserved for smaller boutique shops.
Talks have also begun with a prospective user for both the retail and hotel portions of LeCount Square.
“We’re talking to Starwood,” Apicella said -- as in White Plains-based Starwood Hotels & Resorts Worldwide Inc., which is searching Westchester and Connecticut for a new headquarters office site. “Boy would I love to lure Starwood to this site.”
He said LeCount Square would allow Starwood to locate in one place its offices and a new hotel-residences project for Starwood’s W brand: “That’s something we’re considering.”
Earlier this year, Starwood lost out to The Ritz-Carlton Hotel Company L.L.C. for a deal to operate the hotel and residences within Cappelli’s $400 million Renaissance Square, now under construction in White Plains. Ritz-Carlton is scheduled in 2008 to open there a 123-room hotel and 213 residences.