The lower Manhattan mosque has provoked many doubts and suspicions. Here’s mine: the whole thing is a phony-baloney publicity stunt by a developer in search of project financing.
Maybe an old joke about the development industry can set the stage:
A developer bursts through the door of the office bubbling with good news for his partner: “Hey Sheldon – I had to look at photographs of old man Weinstein’s grandchildren for 2 hours, but we’ve finally got a deal. He agreed to sell us the Maple Street land assembly, and I knocked the price down to $20 million!”
Sheldon answers: “That’s fabulous news – great work – congratulations!”
“Yeah, well there is some bad news too. He needs $10,000 in cash.”
OK bear that in mind as you read this very important report by Isabel Vincent and Melissa Klein in the New York Post.
The site for the proposed Cordoba Islamic center is now occupied by two buildings on Park Place in New York: one the now-famous Burlington Coat factory; the other an adjoining property that used to function as a Con Edison substation. The mosque developers are often said to own both buildings. That turns out to be not exactly true.
They do own one building, the Burlington Coat factory, which they bought in 2009 for $4.8 million. But Vincent and Klein report they do not quite own the other, the Con Edison building. That building and the land underneath are owned by the big New York utility. The mosque promoters are renting the vacant building for $33,000 a year. But if they want to tear down and redevelop, they will have to purchase the property outright. Vincent and Klein report that the utility is now assessing the value of the land, but will likely demand a price of between $10 million and $20 million.
So here’s what I see.
The mosque developers are three Arab-American businessmen: Sharif and Sammy el-Gamal and Nour Moussa. They have a partner in Feisal Abdul Rauf, the Muslim writer and publicist who does most of the talking. But the money and credit pledged to the project belong to the company owned by Moussa and the el-Gamals, Soho Properties.
Soho Properties has paid some $5 million in cash to buy the Burlington Coat Factory building, a building that yields no income. They are paying rent to hold rights to the Con Ed building, which also yields no income. All of this in the midst of the worst commercial property slump in memory, in an area of New York with a very uncertain economic future. And these are not super-rich guys: Sharif el-Gamal lives in an Upper West Side apartment purchased in 2007 for $1 million. Click here to read what $1 million bought in Manhattan before the crash.
You can see why the Gamal-Moussa team would be dazzled by the notion that philanthropists in the Persian Gulf might donate $100 million to raise a grand gleaming Islamic center in lower Manhattan. You can tuck a lot of development fees into a $100 million project. And if not a mosque … what else do you do with their two loser properties on Park Place?
From the NY Post story:
The building at 45-45 Park Place [the Burlington Coat factory building] had been on the market for years with a sale price that at one point was $18 million. It was owned by Stephen Pomerantz, who died in 2006. His widow, Kukiko Mitani, said she was in debt and desperate to unload the property even at a bargain price of $4.8 million to El- Gamal. She said she thought El-Gamal wanted to build condos, not a mosque — but he should build whatever he wants.
And you know what? I bet el-Gamal did want to build condos! Then he figured out that he could never hope to sell them. So el-Gamal hooked up with Feisal Rauf to find financing to build something else: mosque, synagogue, multiplex cinema, driving range, whatever.
But here’s the problem. The more I read about Feisal Rauf, the more I see a very dangerous kind of man … no, not the Islamic extremist kind of dangerous … but rather the kind of guy who can convincingly say, “$100 million? That’s nothing! I have a cousin in Abu Dhabi who could write a check for $100 million himself! Don’t worry about anything, leave it to me, I’ll get the money, that’s the easy part. You get the zoning rights, we’ll buy you out, all cash, easiest money you ever made.” The streets of New York are littered with the carcasses of dead developers who met and believed the Feisal Raufs of this world ….
$100 million is not so easily raised, not even in Abu Dhabi, not in the middle of a global commercial property slump, not with the Manhattan real estate market in a shambles. Believe it or not, rich people in the Persian Gulf are not yearning to plunge into a U.S. political controversy.
So here’s my guess about the future. The money will not be found. The mosque will not be built. I have no idea whether the el-Gamals were praying men before they met Feisal Rauf. But I bet they are praying very hard right now…
