Q: Will the project result in the expansion of the mall?

A: No. The project involves upgrading existing space within the mall without increasing its footprint. This upgrade will be necessary to better position the mall for the targeted signature retail tenants.

Q: Isn’t the mall fine just the way it is?

A: Mall development is a very dynamic industry and it is incumbent on Wilmorite to ensure Eastview is providing the best shopping experience in the market it serves. What works well today may not work tomorrow. Think of the evolution of Eastview, starting when the mall opened in 1971. If the mall still existed today in the same state as when it first opened nearly 40 years ago, it would most likely be in significant decline or no longer be operating as a regional mall. It certainly would not be generating the momentous sales tax and property tax revenue it is today.

Q: Given the current economy, how can Wilmorite justify spending all this money on the enhancement of the mall?

A: Wilmorite will immediately undertake the initial investment in Phase 1, the building block for Phase 2.  Phase 2, which is not expected to commence until 2016, will be significant in scope and cost approximately $40-$45 million. It takes many years of work and preparation to attract the signature retail tenants and we expect the economy to be on solid ground by the time we execute Phase 2. When the economy turns and these signature retail tenants are ready to come to Eastview, we need to be prepared to move forward. We need to be beyond shovel ready by having agreements reached with the community now so that when the opportunity arises, a transaction can proceed with as few contingencies as possible.

Q: Why does Wilmorite need economic assistance for this project?

A: Significant economic incentives are required to attract signature retail tenants. Without these incentives, the mall’s ability to attract these tenants would be compromised, resulting in the deterioration of the mall's competitive position. Signature retail tenants are important because they generate significantly greater sales-per-square foot for a shopping mall and are important to the success of other businesses. They differentiate the mall and will likely increase mall sales over the aggregate sales trends. Competition is fierce in the retail industry and Eastview’s competitors already receive more significant tax breaks than those proposed for this application. Without incentives, it would not be economically feasible to undertake this project and complete these improvements. Without the improvements, the mall will lose its competitive position and over time will decline, along with the economic benefits for the community.

Q: Shouldn’t the demographics alone be sufficient in attracting these signature retail tenants to Eastview?

A: The signature retail tenants we are targeting for Eastview are in high demand by other developers. Not only do these other malls have similar or higher quality demographics to Eastview, but they also offer significant incentives to differentiate themselves from the competition. Without a level playing field, we will be negotiating from a position of weakness and be unsuccessful in attracting them to our market.

Q: What are the project’s two phases?

A: During the first phase of the project $12 million will be invested in capital improvements and upgrades to the mall’s existing space to reposition and improve the tenant mix over the next five years.  This will improve the platform for attracting the signature retail tenants. During this time, Wilmorite is asking the Ontario County Industrial Development Agency for modest assistance in the forms of sales tax abatement on construction materials only and an exemption from mortgage recording taxes. The sales tax abatement on construction materials does not impact the sales tax revenue stream envisioned under the project. During Phase 1 property tax payments will be fixed from a base year and increase by 2% per year to each tax jurisdictions.  Also during Phase 1, the tax jurisdictions will collectively receive approximately $1.1 million more in payments from those properties that have been participating in the Town’s Tax Increment Financing (TIF) program established in 1994.  This program expires in 2014.  Phase 1 will run for five years.

The second phase of the project is the attraction and development of signature retail tenants, which involves an additional investment of $40-$45 million. This phase involves sales tax abatement on construction materials only and an exemption from mortgage recording taxes, as well as continuation of the full/fixed property tax payment program. These payments, however, will increase by 3% per year instead of the 2% amount during Phase 1.  Phase 2 will assure continued certainty in future tax payments with guaranteed annual increases. The assistance requested for Phase 2 also involves using additional future payments beyond that needed for the full/fixed tax payment program. This assistance will be used to pay for some of the needed improvements as an inducement to attract new signature retail tenants.  Phase 2 will run for 25 years.

Q: How will this project affect the county, town and school district?

A: The project will preserve and increase sales tax revenue to Ontario County and its towns, villages and cities under the county’s distribution formula. This is important for many communities that rely heavily on distributed sales tax revenue as part of their budgets. For example, approximately 50% of revenues in the 2009 Town of Victor budget are projected to come from sales tax revenues distributed by the county. Over time, county sales tax revenues have increased from $1.8 million in 1971 to $9.2 million in 2008. This project is expected to result in additional sales tax revenue of $3.8 million annually, according to a county report.

The project will also stabilize and significantly increase property tax revenue for the county, town and school district. Under the full/fixed tax payment program in Phase 2, the total tax payments to the county, town and school district from the Wilmorite owned parcels will grow from approximately $1.9 million in 2016 to nearly $4 million over the following 25 years.

According to a recent community impact report from the Ontario County Industrial Development Agency, the proposed project will have a positive fiscal impact on the county, town and school district. When considering the public costs associated with the project, these tax jurisdictions will continue to see net positive financial benefits over time largely from sales tax and/or property tax revenues.

Q: Will this project create new jobs?

A: This project will create and retain employment. We project that the development of new signature retail tenants will create 100 new jobs. Eastview Mall has grown to be a major employer in the county and town. For example, employment at the mall has grown from about 1,500 in 1971 to approximately 3,600 jobs today. Phase 1 improvements are projected to create 120 construction-related jobs over a several year period.

Q: Why is approval of the second phase of the project necessary now?

A: The approval of the second phase of the proposed project is necessary now in order to secure the commitments from signature retail tenants. The assistance in Phase 2, including the use of a portion of future tax payments for related improvements, will not occur unless and until commitments from signature retail tenants are secured.  This will need to be approved by the County Industrial Development Agency.

Q: What approvals are needed for the project?

A: The Ontario County Industrial Development Agency must approve the proposed financial assistance. As part of this approval process, Ontario County, the Town of Victor and the Victor Central School District need to agree to the full/fixed tax payment program in Phase 2 and the use of assistance to induce signature retail tenants.