The Real Deal New York

Tax cheat looks to upzone Long Island City lot under city’s affordable-housing program

Bruce Bendell pleaded guilty to defrauding the IRS; now wants to build 244-unit MIH building
By Rich Bockmann | September 28, 2018 05:15PM

Bruce Bendell and 44-01 Northern Boulevard in Queens (Credit: Getty Images and Google Maps)

A disgraced car dealer from Queens who recently pleaded guilty to federal tax fraud is now looking to rezone one of his auto lots in Long Island City under the city’s affordable housing program.

Bruce Bendell, a former senior manager at the Major World family of dealerships, is looking to upzone the site of a shuttered Kia dealership on Northern Boulevard to make way for an 11-story mixed-use building with 244 apartments.

But the 64-year-old is facing up to three years in prison after he pleaded guilty in July for failing to report $3.5 million in receipts and payroll expenses on Major World’s 2009 tax forms with the Internal Revenue Service.

“What I pleaded guilty on took place 10 years ago. It is what it is,” Bendell told The Real Deal.

“I don’t anticipate that being a problem, especially since I’m just managing that right now,” he added. “I don’t own a lot of that property; I’m only a 1 percent owner.”

City Council member Jimmy Van Bramer, the local legislator whose vote on the project is key to its approval, was not immediately available to comment on the application.

Under the city’s Uniform Land Use Review Process, rezoning applications first go before the local community board and the borough president’s office before coming up for a vote at the City Planning Commission. If approved, they get sent onto the City Council — where the final say on the project is usually deferred to the local council member — and then onto the mayor’s desk for final approval.

Florence Koulouris, district manager for Queens Community Board 1, said Bendell’s application has not yet come before the board, and that it would be “premature” to discuss whether or not his criminal conviction would impact the board’s decision on the project.

A spokesperson for Queens Borough President Melinda Katz also said the office has not yet received the application and declined to comment. A representative for the Department of City Planning said the City Planning Commission will make its decision based on the application’s land use merits, but noted that the applicant has to submit a doing business with the city form and “be honest and forthcoming in all their materials.”

Property records show that a limited liability company managed by Bendell bought the site at 44-01 Northern Boulevard in 2008 for $3.5 million. The property is currently zoned for manufacturing use, but on Thursday Bendell filed an application that would transform the lot into more than 100,000 square feet of buildable residential space under the city’s Mandatory Inclusionary Housing program.

In exchange for the upzoning, Bendell would set aside either 20 percent of the project’s units for those making an average of 60 percent of the area median income, or 30 percent of the units for renters earning 80 percent of AMI.

The stretch of Northern Boulevard is lined with auto dealerships, which — due to their large sizes — make for attractive development sites, though new residential development has been sparse.

Silver Star Motors earlier this year launched leasing at its 85-unit Silver Star luxury rental building at the corner of Northern Boulevard and 36th Street, which rose on the site of the company’s former Mercedes-Benz dealership.

Rents in the building range from about $2,000 for a studio to as much as $3,000 for a one-bedroom apartment, according to StreetEasy.

The Silver Star building sits about half a dozen blocks away from Bendell’s property, and he said he can see new projects moving further in toward Queens’ more residential neighborhoods.

“I think that redevelopment on Northern Boulevard makes a lot of sense,” he said. “There’s a lot of development going on in Long Island City. This is almost coming into Woodside, on the borderline with Astoria.”

Bendell, along with his brother Harold Bendell, pleaded guilty before a federal judge in U.S. Eastern District court to charges of filing a false tax return. They paid $3.88 million in restitution and resigned from Major World.

The two are set to be sentenced in November.