By Alexander Dworkowitz
The developer working to transform the Caldor site into a vertical mall took out an unauthorized loan from the condominium he helped manage to finance part of his project, according to the building’s monetary statement.
The developer, John Chen, resigned from the board in July after its members learned of the unauthorized $570,000 loan, according to a report of the Park Regent Condominium.
The loan, taken out from the building’s reserve fund on May 9, was repaid in full with partial interest on July 22, the report said.
The Park Regent is a 239-unit building at 41-25 Kissena Blvd., a block from the Caldor property. The financial report was prepared by Mark Mazzo, an accountant.
Chen acknowledged taking out the loan to help finance the downtown Flushing Caldor project, but he said the loan was taken with permission of other members of the condo’s board.
“They knew about it,” he said. “It was a one-month arrangement.”
Chen, who was serving as treasurer on the board, said his resignation from the board came because he was busy with the mall and had nothing to do with the loan.
Board members, however, wrote a letter to the Queens District Attorney about the incident. The district attorney’s office said they could not acknowledge the receipt of the letter.
Chen is the driving force behind transforming the Caldor property, which sits on Roosevelt Avenue between Main and Union streets.
Having sat vacant for more than three years and considered by many an eyesore, the 165,000-square-foot property has become the subject of ambitious plans of Chen and his company, 724 Management.
Chen is working on attracting national retailers to the store. The developer said the Gap, Nathan’s and the Children’s Place, a children’s clothing store, all plan to come to the building, located in the heart of downtown Flushing.
Chen also said he wanted to put up a glass facade around the mall and connect the building to its neighbors, Macy’s and Old Navy.
Chen has entered into a contract with the Vornado Realty Trust, which owns a controlling interest in the property, to buy Vornado’s lease.
The closing date for the deal, which Chen said was worth $19 million, came and went in September. Chen said he was in negotiations with Vornado about details of the contract.
Chen predicted the deal would be closed over the next two months and the mall would open in April.
Vornado, however, is looking into developing the property themselves, said Councilman John Liu (D-Flushing), who has raised doubts about Chen’s plan.
“He’s been way premature,” Liu said. “Way, way premature.”
The councilman said he has made sure not to appear in conjunction with Chen.
Chen’s loan from the Park Regent came shortly after the building’s management company took leave from the building.
The Mark Greenberg Real Estate Co., Inc. managed the building from 1998 to Jan. 31, 2002.
In 2001, a group of people who owned apartments in the complex, a group including Chen, decided they wanted to run the building without a separate management company, said James Goldstick, vice president of Greenberg.
Goldstick said it was an uncommon move.
“It’s very unusual for a building of this size not to hire an independent company,” he said.
While he resigned from the board, Chen said he still owns about 10 percent of the building’s units as well as its parking lot.
Chen said he thought little of the building’s financial report.
“You do a lot of things in the community,” he said. “Some people like it. Some people don’t.”
Reach reporter Alexander Dworkowitz by e-mail at Timesledger@aol.com or call 229-0300 Ext. 141.
