Last week, through a third party, Allentown businessman Nat Hyman contacted Joe Reibman, owner of the Dixie Cup Building in Wilson Borough. Hyman, who specializes in converting old factory buildings into apartments, has made no secret of his desire to purchase the property. But after some initial back and forth, Reibman has once again missed an opportunity to miss an opportunity.
Reibman, who is seeking a tax break known as a LERTA, owes about $400,000 in back taxes on the property. He failed to do anything with the property after being granted a TIF and a KOZ, the mother of all tax breaks. Most real estate appreciates in value over time, but the Dixie Building is actually losing value because of Reibman's failure to maintain it. The building is deteriorating fast. In addition to hundreds of broken windows, it has massive holes in the flooring and is littered with both lead paint and asbestos. He has been both cited and sued by Wilson Borough for code and public health and safety violations. Because he has done little to secure the property, it is an attractive nuisance.
In June, a New Jersey developer approached Northampton County Council without notice and told them he needed a LERTA for the property so, according to his own words, he could convert it into a warehouse. This was not just any old LERTA, where tax increases on the basis of property improvements are phased in over a period of 10 years. Under this LERTA, which the County had no role in drafting, tax increases would only kick in after four years, meaning a 10 year tax break would actually be a 14 year tax break.
Northampton County Council has tabled this LERTA on steroids and is instead considering a more traditional model.
Enter Nat Hyman. He is willing to buy the property, and asked Reibman how much he wanted.
Reibman asked for $10 million and Hyman offered $5 million. Reibman immediately reduced the price to $7 million, and Hyman increased his offer to $5.5 million. Both parties were negotiating and things looked promising. Then Reibman said he was ending negotiation unless he knew the identity of the buyer. Hyman disclosed his identity, and then Reibman suddenly said No. He added he had several better offers.
This, however, is untrue. At the same time that he was killing a deal with Hyman instead of continuing to negotiate, Reibman has listed the property on Loopnet, a commercial real estate site. Once again, he is asking for $10 million.
Why would he be listing the property of he already has several good offers? Why would he list the property when he and Hyman were only $1.5 million apart?
Simple answer. Greed.
Here's how Hyman out things in a phone call yesterday.
"I offered Mr. Reibman $5,500,000 with no contingencies and a 30-day closing period. This offer allows him to pay off his $450,000 obligation to the taxpayers, no longer seek the LERTA tax abatement, allow this blighted building of 20 years to finally be redeveloped by a responsible developer and him to walk away with a $5,000,000 profit. Mr. Reibman said No."
Hyman adds, "I would seek no government incentive of any sort which would obviously save the taxpayers a great deal of money and then put this massive property back on the tax rolls."
Reibman has a right to be greedy. We should play no part, however, in financing his rapacity.
24 comments:
Bernie, I have poor reading skills. I apologize. But Reibman stopped negotiations because he found out he was dealing with Hyman? Or because Hyman disclosed the buyers' identity - which Reibman didn't like?
BernieOHare to 1:20, Reibman stopped when the learned Hyman was the purchaser. I think it was clear.
How many LERTA'S does Joe Reibman have?
https://www.zoominfo.com/p/Joseph-Reibman/137545780
Was this a political decision, did democrat Reibman refuse to sell to republican Hyman.
This is the difference between being pro-business and being pro-capitalism. Pro-business always involves taxpayers' money and tilting scales for connected people. It serves the few while doing little for most. Capitalism is Hyman's plan that will serve many, including those needing housing. But capitalism requires competing with our "pro-business" government and its schemes. Pro-business won the day. Pro-capitalism lost. Schemes that permit politicians to spend our money to help the connected need to go away.
Bernie,
Can't say what Hyman would do with the Dixie building, but his Allentown projects are making the downtown riverside area much better for sure. Someone said they're 100% occupancy. He even opened free space in the Adelaide silk mills building for a police substation.
"Was this a political decision, did democrat Reibman refuse to sell to republican Hyman." Political party is irrelevant to this discussion. Hyman happens to be a moderate Democrat who sued Trump and won. Reibman's family is Democratic but I never checked his political affiliation nor does it mean anything to me.
Does Reibman also won the abandoned gas station at 22 & rt 191?
I met Mr. Hyman once. He is among the smartest people I have ever met. It sounds like Reibman is among the dumbest.
Anon 6:08 & 6:50 are both spot on. Hyman took most of downtown Allentown and turned it all around with no government help. He is a tough businessman who gets results and doesn't rely on the government to give him anything. Allentown lost big time when Hyman didn't become Mayor. Ray O'connell will have 2 legacies: 1. Doing absolutely nothing while he was mayor and 2. Running his self-serving write in campaign purely designed to keep Hyman from being elected and getting Pawlowski reelected. We can all thank Ray for getting all of us dragged into the Pawlowski mess instead of having Hyman as mayor and him turning the city around.
What is wrong with Reibman? Why wouldn't he just take the money and run?!
I smell the next new reality show. "Arrested Development"
Bernie:
If Reibman hasn't paid his taxes for 4 years , why hasn't this gone to Sheriff's sale years ago? If I didn't pay my home real estate taxes for 4 years, it would have been gone by now. Who decides when something should go to Sheriff's sale?
Joe, swallow your pride, sell to Hyman and retire a rich man. Let Hyman deal with the headaches.
Reibman "never misses an opportunity to miss an opportunity." That's funny Bernie.
Bernie: How is Nat Hyman able to make projects work without government money when everyone else claims to need it? Does he just operate more efficiently or on lower profit margins? or are the other developers just greedy and he is not?
Hyman saying that there is 5 million profit is probably wrong. What was Reibman's acquisition cost? Plus he has had carrying costs of the property--taxes, insurance, grass/weed removal, etc.
I bet Reibman has make whole number that is more than 5 million.
Hyman saying that there is 5 million profit is probably wrong. What was Reibman's acquisition cost? Plus he has had carrying costs of the property--taxes, insurance, grass/weed removal, etc.
I bet Reibman has make whole number that is more than 5 million.
If this revelation doesn't put an end to any and all tax break conversation, all of NorCo council should be thrown out at the next opportunity for each. This is over. We're finished here. Reibman is forcing a solution that requires taxpayer money to bail him out and make him money he otherwise can't make from a turd of an investment that he tortured the surrounding community with for years. Respectfully, he can go f himself.
Why does Reibman's Glendon properties have LERTAs too?
What Would Jeanette Reibman Would Have Done About This?
Anyone know what Reibman paid for the property back in the early 1980s and if he has a mortgage against it?
Having dealt with people like Reibman before, my prediction is he dies of old age before title ever transfers on this property.
Take it to Sheriff's sale and let Hyman buy it that way! No taxpayer funded warehouses!!
"What Would Jeanette Reibman Would Have Done About This?"
If the current state of PA's education system (her baby) is any indication, that property would be far worse, with no hope for improvement after millions of tax dollars spent on it already.
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