This special meeting of the Syracuse Industrial Development Agency (SIDA) was called to address a single agenda item regarding a default by Towers Realty, owner of the AXA towers. The board voted unanimously to terminate the existing lease and PILOT agreement, following legal advice that the owner’s failure to cure default and pending short sale warranted removal of SIDA from the foreclosure proceedings, returning the property to the tax rolls.
Good morning. Good morning, and thank you all very much for attending this special board meeting of the Syracuse Industrial Development Agency. Appreciate everybody's response and quick date arranging. Um, I'd like to call the meeting to order. I'll start with the roll call of the board. I'm Kathy Murphy. Steve Thompson. Thank you all very much. Proof of notice was properly served. We have one item on the agenda for this meeting. It is a new business item with Towers Realty Susan. Good morning, everyone. You may recall uh I think all of you were on the board at the time, although maybe not, but um in or around twenty eighteen, twenty nineteen, twenty twenty that time frame, the agency entered into a leash transaction with Towers Realty, which is the owner of what will may be known as the AXA towers. And the lender commenced a foreclosure action with respect to those defaults. It triggers a default, in other words, under our documents. But I received information last week that they actually were going to sell the building, that the lender was going to do a short sale, which means you take it out of foreclosure and you sell it. But at this point, I it is in the agency's best interest, in my legal opinion, to declare the default and collapse the structure. So you said you're welcome. Questions? Comment what would it do to what they've received already? Anything? No. Okay. It's the two towers. One of the two towers. Towers one and two. So do you know how far along in the foreclosure proceedings they are? It's been pending for a couple of years. So I think they're probably close to the end or could be. To be honest with you, mid-stream, they appoint they got a receiver appointed, so a receiver stepped in and started collecting rents. That happened about a year ago. For what it's worth, at some point they amended their complaint and named the city of Syracuse as a defendant as well, because there is a convoluted history about the garage that sits beneath the towers. So at one point in time, the garage, which is subterranean under both, under the entire plaza. It spans the plaza. It spans the whole block under the plaza. Half of it was owned by the city of Syracuse. Half of it was owned by the owner of the towers. I didn't live here when that happened. I do not know, but that was the structure. And at some point it made sense for whatever was happening there. Um as you might imagine over years and years and years, the um plaza leaked, causing damage in the garage. There was an argument about who was responsible for maintaining it, et cetera, et cetera. So there was a huge it spanned multiple years. Kristen Smith was corp counsel at the time, and I was outside counsel helping her deal with this garage issue. Ultimately, it was resolved through a settlement. Um the lender amended their complaint to include the city because they claimed that the city engaged in uh violation of the debtor and creditor law. I'm sitting here today telling you I don't believe they ever would have been successful in that. They put a pin in that cause of action while they continued to litigate against the owner of the tower, but that's hanging out there. Um should resolve all of that anyway, but it's it's a separate matter. Oh, so what do you suggest we we do here?