STATEN ISLAND, N.Y. -- A source with ties to the NY Wheel has revealed how the initial $400 million allotted for the project was spent, with $250 million alone spent on a garage and a terminal building that would offer an immersive pre-ride experience before boarding the 630-foot observation wheel.

Last year, the NY Wheel told the Advance that $400 million of the $580 million secured for the project through private investors was already spent by the time it was indefinitely delayed in the spring.

But the NY Wheel never specified exactly how that money was spent.

The Advance's source, who spoke in the condition of anonymity, recently outlined the breakdown of the $400 million.

$250 MILLION

About $250 million was spent on the construction of the parking garage and terminal building. The two structures were initially estimated to cost $180 million -- but ballooned to $250 million, the source said.

The terminal building would not only be used for ticket sales, but would house an immersive pre-ride experience -- described as a secondary attraction -- while people waited on line to board the NY Wheel, the source said.

There would also be a photo booth, "grab and go" food and beverage service, security offices and a gift shop.

Atop the structure would be a green roof used as a concert venue and picnic area, where at least 18 concerts per year would unfold, said the source.

$80 MILLION

About $80 million was paid to the developer's former contractor, the Holland-based Mammoet-Starneth, which walked off the job in May 2017, and was subsequently fired.

$40 MILLION

About $40 million was spent in the first 18 months to get the project to the point of being able to obtain the necessary approvals from 23 different city agencies.

Some of these preparation expenses included environmental studies, lighting designs, architectural work and various revisions, engineering studies, and site preparation.

$30 MILLION

The balance of the $400 million, roughly $30 million, was chalked up to the cost of running the site.

The New York Wheel LLC likely also has incurred hefty legal fees since it has been battling its fired contractor, Mammoet-Starneth, in court for more than a year.

$300 MILLION MORE NEEDED

The source also told the Advance that at least $300 million more is needed to bring the project to fruition.

A NY Wheel spokesperson wouldn't comment on the $400 million breakdown.

Since this is a privately-funded project, the NY Wheel has no obligation to disclose how much financing is needed for the tourist attraction to come to fruition.

LEAD PLAYERS

According to public records and multiple sources, after Rich Marin, co-founder of the New York Wheel, took a lesser role in the organization last year, the main investors -- Jeffrey Feil of The Feil Organization, based in Manhattan, and Lloyd Goldman, a New York real estate developer and founder of BLDG Management -- took control of the project. Jordache Jeans mogul Joseph Nakash is another major investor, according to sources and published reports.

All three have declined to return Advance inquires for comment about the status of the project.

WHY MAMMOET WAS HIRED

The source told the Advance that American Bridge, the company that built the Las Vegas High Roller, was initially consulted in the planning stages. However, Mammoet-Starneth was eventually hired for the job because the company agreed to a lower price. In addition, Mammoet agreed to supply and install the Wheel capsules, and American Bridge would not handle that work, the source explained.

The NY Wheel has said that American Bridge is being tapped as the new contractor, however no agreement has been reached.

A TUMULTUOUS WEEK



Many new developments in the NY Wheel project have occurred over the last week. Here is a recap:

SEPT. 4



In court papers filed on Sept. 4, the NY Wheel said it wanted to extend the Sept. 5 deadline pursuant to an agreement currently being prepared.

The NY Wheel issued the following statement to the Advance:

"The New York Wheel is in the process of negotiating an amendment to the settlement agreement, including extending the standstill period. In connection with the amendment negotiations, all parties have agreed to extend the Sept. 5, 2018 deadline in the settlement agreement until, at least, Sept. 11, 2018, so that the amendment can be negotiated."

SEPT. 6



On Thursday, the Advance learned the city Economic Development Corporation (NYCEDC) would not provide financial support for the New York Wheel.

The NYCEDC went as far as to call the project a "risky deal" for the city.

"Since 2012, the city accepted the New York Wheel as part of a multi-pronged strategy to revitalize Staten Island's North Shore," said Ryan Birchmeier, NYCEDC spokesperson.

"The Wheel was presented then as an entirely privately financed venture. In the years since, while other North Shore projects have advanced, the Wheel has faced a variety of challenges. In that time, the city worked hard to help the developers to advance the Wheel while remaining clear eyed about the risks of putting public money into an expensive, speculative project," he continued.

A NY Wheel spokesperson said the developer was surprised by NYCEDC's statement.

"Although the NY Wheel developers were disappointed and surprised by the NYCEDC's definitive statement about The Wheel's proposed finance plan -- given that only Wednesday we were encouraged to continue negotiations with the city -- in reliance upon those continued negotiations with the city, The Wheel has obtained an extension of the standstill period to continue these negotiations," said the Wheel spokesperson.

However, when reached on Sept. 7 for comment, the NYCEDC said it remains prepared to work collaboratively with the NY Wheel and explore alternate options that will allow construction to recommence.

SEPT. 7



The New York Wheel was granted one last shot in the mediation process to advance the construction of the 630-foot tourist attraction on the St. George waterfront on Friday. The developer and its former contractor have come up with a proposed amendment to the original settlement agreement -- extending the standstill period for getting the project back on track until early 2019.

The embattled Wheel filed a motion for an order approving the amendment in Delaware Bankruptcy Court that -- among other things -- gives the developer a final standstill deadline of Jan. 7, 2019, to hire a new contractor to complete the project, according to court documents.

The amendment states that no party will be allowed to seek additional extensions beyond that January deadline.

In exchange for the extension of the standstill period, the amendment provides, among other things that "if no termination event has occurred on or prior to October 23, 2018, NYW shall be deemed to have waived and released its rights with respect to the ownership of the Wheel Components and allocation of proceeds of any sale related thereto," the motion states.

However, if the Wheel can provide proof to Mammoet-Starneth and Mammoet USA (MUSA) that it has the financing to purchase the parts, the developer can participate in an auction of the Wheel components, according to court documents.

A source of dispute between the Wheel and its contractor has been the rights to the Wheel parts.

The developer has been paying high storage costs for the Wheel components -- close to $500,000 per month.

"As the motion and amendment indicate, storage costs continue to be covered by the New York Wheel on the same terms they have been covered under the original agreement," said a New York Wheel spokesperson on Saturday.

In addition, the NY Wheel releases all of its claims against Mammoet-Starneth if it doesn't terminate the agreement by Nov. 7, according to the motion.

According to court documents, the amendment also allows Mammoet-Starneth to complete its Chapter 11 Bankruptcy plan.

"These benefits allow for resolution of the ownership dispute regarding the Wheel components and for the Debtor to proceed towards an uncontested plan confirmation hearing," the motion states.

MORE RECENT STORIES ABOUT THE NY WHEEL:

Embattled NY Wheel: Court motion outlines last shot at mediation

Exclusive: NY Wheel says project is still being pursued

NY Wheel applies for an extension to get the project back on track

New York Wheel deadline is Wednesday. What happens next?

One NY Wheel investor's reason for pulling money out of the project

50 days into NY Wheel agreement, no word on getting project back on track

Exclusive: NY Wheel gets green light to hire new contractor

New York Wheel stalled for 10 months: How did we get here?

Exclusive: Former NY Wheel CEO Rich Marin now involved with Eye of Texas Wheel

Former contractor pushing to auction $9M NY Wheel legs, other parts

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