New York Wheel has four months to find funding to restart work
“[We are] committed to the completion of the project, which is the centerpiece of a Staten Island redevelopment project. This settlement will allow New York Wheel the opportunity to finalize its financing arrangements and re-commence the construction and completion of the Wheel,” the New York Wheel said in a statement responding to a bankruptcy court stipulation that gives the project 120 days to find the required funds and hire a new contractor (h/t SI Advance). This comes after the project’s design team walked off the job last June amidst a “bitter pay dispute” with the developer. The 630-foot Ferris wheel has been plagued by cost overruns and delays from the beginning, so if they’re not able to get things back on track by September 5th, it could mean the end of what was planned to be a major revenue generator and attraction for Staten Island.
Photo from the October 2016 arrival of the Wheel’s four legs to the South Brooklyn Marine Terminal
Photo from the November 2016 arrival of the two pedestals to Staten Island
Around this time last year, the design team at European company Mammoet-Starneth (they were behind the London Eye) walked off the Staten Island job, threatening to terminate their contract with New York Wheel LLC. As 6sqft previously explained, the developer then filed a federal lawsuit “claiming that halting work was putting the borough’s waterfront revitalization at stake and that Mammoet is responsible for ‘extortionate’ billing, ‘defective’ equipment, and shoddy, dangerous construction.” The Wheel ultimately fired the contractor but in December, Mammoet filed for bankruptcy and pushed to auction off roughly $68 million of parts created for the wheel, saying it was costing them $700,000 a month to store the parts.
After failing to come to an agreement in remediation in March of last year, the two parties have been locked in a legal battle with the Delaware Bankruptcy Court. New York Wheel LLC was ordered to pay $2 million towards the aforementioned storage costs, and this past Monday, they reached an agreement to enter a 120-day standstill period, which will allow the Wheel to come up with the necessary financing to move forward and hire a new contractor. The judge is expected to officially sign the agreement next week, but during the next four months, the Wheel can terminate the deal at any time if they’re not able to come up with the funds.
It’s not known exactly how much financing is needed, but since its inception, the project has gone from $230 to $580 million. Last spring, the Wheel said it had already spent $400 million in private funding, but that couldn’t be confirmed. The would-be world’s tallest Ferris wheel was originally supposed to open in October of 2016.
[Via Staten Island Advance]
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