The Real Deal New York

Getting the spins: Work grinds to a standstill at New York Wheel as designer walks off the job

Developers are fighting perception that the $600M project is sunk
June 26, 2017 09:10AM

Rich Marin and a rendering of New York Wheel (Credit: NYCEDC)

The giant tourist attraction on the north shore of Staten Island is turning out to be one squeaky wheel.

Mammoet-Starneth, the European company whose staffers helped build the London Eye wheel and was contracted to design the 630-foot-high New York Wheel, walked off the St. George job site May 26, the New York Post reported.

Work has ground to a halt as the two sides battle in court, leaving developer New York Wheel fighting the impression that the $600 million project is off the rails.

“When the world knows that [the] project has been stopped, whether you call it suspension or termination or withdrawal, that is the death knell for the project,” Randy Mastro, the developer’s attorney and former Deputy Mayor, told the federal judge overseeing the case last month.

“When the New York Post and the Daily News and the Times write about this, the impression is the project has gone south,” he said.

The wheel’s investors include CEO and former Bear Stearns executive Rich Marin, Eric Kaufman, Meir Laufer, Jay Anderson, Lloyd Goldman and Joseph Nakash, as The Real Deal reported in early 2016.

The investors in December settled a messy legal dispute over their equity stakes.

Mammoet-Starneth claims it walked off the job because New York Wheel built a faulty pad to hold the wheel, and that there was “insufficient soil support and parts that don’t work.”

A consultant for New York Wheel said the city Department of Buildings has not yet issued permits to go forward, saying the company Mammoet-Starneth chose to build the giant legs that would support the wheel was not on the DOB’s list of approved companies.

New York Wheel has accused the Netherlands-based firm of breaching its $165 million contract to build the wheel, and claims the original $300 million price tag has doubled.

Both sides agreed on June 12 to a 30-day mediation period set to end in mid-July. An analysis by TRD last year found the financial projections for the Wheel in its first year of operations to be dramatically higher — $127 million in revenue — than was first suggested in 2011, at $21 million. [NYP]Rich Bockmann