Builder Rules Out Syracuse for Mega-Mall, Official Says

July 12, 2003

Metropolitan Desk

By Al Baker, The New York Times

ALBANY, July 11 - An official at an upstate development company said today that the company had decided not to build the nation's largest mall and tourist center in Syracuse. But the official with company, Pyramid Management Group, who spoke on the condition that he not be named, said the plan for the mega-mall would not be abandoned altogether. The mall, known as DestiNY USA, a $2.2 billion behemoth of a shopping, tourism and entertainment complex, will be erected somewhere else within New York State or in the Northeast United States, he said.

''The decision has been made not to build this project in the city of Syracuse,'' the Pyramid company official said. ''This is something that could easily be built outside of the city, in Onondaga County, or any place else in the state or any other state.''

The official said a public announcement had been planned for Monday or Tuesday to outline the official reasons for the decision, which he said was the result of a series of ''difficulties with the city's administration.''

Specifically, company executives have grown mistrustful of the city over a series of recent issues regarding the zoning of land to be developed, as well as agreements that govern how the project will go forward, company officials said today.

Questions were swirling today after officials of the Greater Syracuse Chamber of Commerce told The Post-Standard, a Syracuse newspaper, that the developer had told them in a meeting last week that the project was dead.

But Matthew J. Driscoll, the mayor of Syracuse, said today that he had not heard from the developer, Robert J. Congel, one of the founders of the Pyramid mall empire, about whether the project would go forward in the city.

''He has not communicated to me that DestiNY is done,'' said Mr. Driscoll, who said he was perplexed about why the company had not communicated its concerns earlier. ''I stand ready, willing and able to help them move this vision forward.''

In the past year, promoters of the mall have touted its square footage (more than twice that of the Empire State Building); its amenities (400 stores, 30 cafes and a 20-screen movie complex); and its promise to enrich the region (a company consultant estimated that it would create as many as 122,000 jobs and $12.5 billion in economic activity). The company says it has invested more than $100 million to date on legal, architectural and other costs.

But with the likelihood of finding private investors to underwrite the entire project in question, company executives lobbied extensively this spring in Albany. They tried to persuade lawmakers to guarantee that the company would continue to receive tax benefits of up to $600 million over 14 years that it is entitled to under the state's Empire Zone program, even if that program is later disbanded.

Though no formal bill on the matter surfaced this session, company executives, Gov. George E. Pataki and the state's two top legislative leaders remained hopeful that a deal could be worked out, perhaps when the Legislature reconvenes in a special session this fall.

''Both houses were working together to try to resolve this,'' Charles R. Carrier, a spokesman for Assembly Speaker Sheldon Silver, said today, adding that Mr. Silver had not been told that the deal was dead.

''The Speaker was always favorably impressed with the concept and what it might mean to the central New York region,'' he said. ''But, on the other hand, there were a lot of difficulties in answering questions and putting together the details, and that's still where things stood when the session ended.''

Pyramid officials said they were encouraged by their experience in Albany, though disappointed with the outcome. What raised their ire, company officials said today, were a series of developments in Syracuse.

They said that an effort to rezone a section at the southern end of Onondaga Lake as residential directly conflicted with the DestiNY USA project and with plans to build a 43-story hotel on the site. Also, they said, an agreement that would dictate the relationship between the city and the company was approved by the Syracuse Industrial Development Agency before negotiations were finalized.

Mayor Driscoll rejected as false claims that any zoning changes would conflict with the project. He said he had requested that a zoning vote be delayed until fall. He said changes in the industrial development agency agreement had been sent to the company three days before the agreement was approved.

David Cordeau, the president of the Greater Syracuse Chamber of Commerce, said he had met with Mr. Congel this month.

''He said it's not going to happen here,'' Mr. Cordeau said.

Still, Mr. Cordeau said he spent much of today meeting with supporters of the project, trying to organize them to persuade the developers to stay in the area. ''There's an army of people behind this project,'' he said. ''None of us would be able to sleep if we didn't make one more run at this.''

When asked if the decision to abandon the city of Syracuse could change during the weekend, the Pyramid official who spoke on the condition of anonymity said no.

''This is an absolute, cut-in-granite decision,'' he said. ''One thousand percent.'' He added: ''It will not be built within the city limits. It will be built somewhere else.''

Several nearby states have been courting Mr. Congel, the company official said. If DestiNY USA is not built in the Syracuse area, Mr. Cordeau said, ''We will have missed the biggest opportunity we ever will have.''