Curran Takes Action to Terminate Coliseum Lease, Demands $2 Million Payment Owed by Onexim

In an effort to ensure a plan for sustained operations of Nassau Veterans Memorial Coliseum and redevelopment of the surrounding 72 acres of pavement known as the Nassau Hub, Nassau County issued a Notice of Default to Coliseum tenant Nassau Events Center, LLC (NEC), controlled by Onexim Sports and Entertainment Holdings USA, Inc.  The County’s action follows the company’s decision last month to shutter the arena indefinitely and exit its development obligations while seeking investors to take over operations and assume the remaining debt on the building.  The County demands $2 million in payments due, which if not paid within 15 days, would constitute an event of default under the Coliseum lease.  The lease allows an additional 30-day cure period for NEC’s leasehold lender, Nassau Coliseum Funding 100, LLC, to step into the tenant’s shoes and bring rent payments current before the County could terminate the lease.  NEC currently owes $100M to the lender in connection with the 2015 renovations of the Coliseum.  The loan agreement is secured by the lease.

In a separate letter to both parties, which also copied Hub redevelopment partner RXR Realty, the County stated its willingness to hear plans from Onexim and the lender regarding the continued operation of the Coliseum and plans to move the Hub development project forward with RXR, the developer on the Hub site.

“We cannot drag our feet on a strategy for the future of this hallmark Nassau County arena nor risk the unprecedented progress we’ve made to transform the Hub site,” said County Executive Laura Curran. “We did not take today’s action lightly and believe it is the best way to bring all parties to the table.  I am committed to swiftly reviewing any proposals to get a plan for the building and the redevelopment back on track for the benefit of all our residents – including our devoted Islanders fans – who were looking forward to a final season at the Barn.”

In addition to the Islanders, Onexim’s decision to shutter the Coliseum leaves the LI Nets with uncertainty concerning their ability to play at the Coliseum in the future.

The County’s action follows NEC’s request to the County for a rent forbearance agreement.  The County had requested that NEC provide an affirmative plan to demonstrate how NEC would ensure sustained Coliseum operations and development of the Hub site, and how the requested forbearance would facilitate those objectives.  The County remains concerned about the status of NEC’s leasehold mortgage loan.