Nassau County Executive Laura Curran announced that Nassau Live Center, LLC, (“Nassau Live”) has stepped into the shoes of Nassau Events Center, LLC (“NEC”) as the County’s new tenant at the Nassau Coliseum.
Nassau Live is an affiliate of Coliseum lender US Immigration Fund (“USIF”). This deal avoids protracted litigation amongst multiple parties and recovers payment of over $2.2 million in past due rent owed to the County by NEC’s parent company, Onexim Sports & Entertainment. As part of the transaction, the Administration ensured that Nassau Live has agreements in place with arena operator ASM (the Coliseum operator under NEC), the New York Islanders and the Long Island Nets, positioning the Coliseum to seamlessly host team play once the State permits the re-opening of large sports and entertainment venues. Finally, the County also preserved its 2019 Development Plan Agreement (DPA) with the Coliseum tenant and developer RXR Realty for transformative redevelopment of the Nassau Hub.
“This deal follows rigorous negotiations and fulfills my main objectives – forging a path forward for sustained Coliseum operations and keeping us on track to redevelop the Nassau Hub,” said County Executive Laura Curran. “We’ve made sure our Islanders can come home to Nassau for one final season at the Barn while continuing all the momentum we’ve built with our community partners on a reimaged Hub that would drive our economy and benefit our residents for generations to come. Our vision for the project as a live-work-play destination anchored by a medical research and innovation district is even more important now, following the COVID-19 public health crisis.”
The County accepted a settlement in lieu of foreclosure between NEC and USIF and pressed for additional agreements amongst the parties in order to address the challenges presented by Onexim’s decision to leave the New York market and exit their partnership for Hub redevelopment.
“I want to thank the parties for coming to the table and working tirelessly to fast-track a solution to this complex transaction,” said County Executive Curran. “We are pleased to have ensured a swift transfer of the lease to a new tenant eager to resume Coliseum operations and partner with us on Hub redevelopment.”
Arena Set for Resumed Operations Pending New York State Re-Opening Guidance
Nassau Live has a month-to-month agreement in place with arena operating company, ASM (former tenant NEC’s operator) and has also taken assignments of the New York Islanders and Long Island Nets contracts, ensuring that the building is positioned for play in the 2020-21 seasons. The Islanders agreement covers the period until their permanent Belmont home is set to open, in October of 2021.
In recognition of the current pandemic and the uncertainty presented to Coliseum operations, the County has granted Nassau Live with a “standstill period” of 60 days (with a possible 30 day extension) to more fully present to the County its plan for sustained Coliseum operations and a request for an adjustment of the rent payable under the Lease. During this period the County has agreed not to issue any notices of default for non-payment of rent by the new tenant.
Concrete Commitment to Future Hub Development
Throughout negotiations, the County worked to ensure that the transfer of the Lease to Nassau Live would support the DPA and plans for development of the acres of pavement surrounding the Coliseum known as the Nassau Hub. This plan was signed by the County Executive and Nassau Hub Master Developer LLC following unanimous approval by the Nassau County Legislature, with support from the Town of Hempstead and an engaged Community Benefits Advisory Committee. USIF and developer RXR have confirmed that they have an agreement for Hub development and that the DPA between the County and Nassau Hub Master Developer remains in place. The substitution of Nassau Live as a development partner with RXR under the DPA will require approval of the Nassau County Legislature.
Lease Transfer, Modifications
The transfer of the Lease from NEC to USIF’s designee, Nassau Live, is as of right by operation of the Lease and is on the same terms as those contained in NEC’s original 2013 lease with the County. That lease allowed NEC to obtain leasehold financing in connection with the $180 million renovation of the Coliseum. NEC obtained EB-5 leasehold financing pledging the up-to 49-year Coliseum lease as collateral in late 2015. The lease included standard lender protections, including the right to cure any tenant default and take over the lease by stepping into the shoes of the borrower/tenant, NEC. Lender’s rights under the lease were triggered by the County’s decision to issue a notice of default in July.
It is anticipated that Nassau Live will seek modifications to the terms of the Lease given the current pandemic. Lease modifications will require all requisite County approvals, including the Nassau County Legislature.
