Amazon plans to buy portion of Sunrise Mall property, open operations center

Amazon plans to buy 26.7 acres of the long-struggling Sunrise Mall property in Massapequa, where the e-commerce giant wants to open an operations facility. 

“Amazon is exploring options at the …  Sunrise Mall site in the Town of Oyster Bay with the intent of opening an operations facility in the future. This process is in the early planning stages and additional steps remain,” the Seattle-based company said in a statement Thursday afternoon.

An operations facility, which is a location where Amazon conducts logistics and fulfillment activities, could include a fulfillment center, sorting center or a last-mile site, Amazon spokeswoman Smitha Rao told Newsday in an email.

A last-mile site is used to deliver purchases the remaining distance to customers’ homes or jobs.

Amazon’s plan advanced Thursday morning after the Nassau County Planning Commission approved an application from the mall’s owner, Sunrise Mall Holdings LLC, to subdivide about 67 acres of the 77-acre mall site into four parcels, one of which Amazon intends to buy.

Officials representing Sunrise Mall Holdings said during the planning commission’s work session and public hearing Thursday  that Amazon was under contract to buy the land.

The subdivision “is merely allowing us to start the clock for a development,” said Jeffrey S. Mooallem, executive vice president and chief operating officer at Urban Edge Properties, a Manhattan-based real estate investment trust that is the managing member of Sunrise Mall Holdings.

A boom in online shopping during the COVID-19 pandemic, which started in early 2020, fueled the growth of Amazon’s warehouse numbers.

On Long Island, Amazon has eight warehouses, six of which opened in the last five years, and one planned for Route 110 in Melville.

At each of the facilities are dozens of delivery workers who are employed by independent small businesses that own the delivery vans. Between 100 and 150 Amazon employees work as package handlers at each warehouse.

The mall is currently made up of 22 tax lots, which, following the planning commission’s vote Thursday, will be subdivided into four new parcels, said Greg Hoesl, a planner in the Nassau County Department of Public Works.

Of the four new parcels, Sunrise Mall Holdings plans to retain the largest piece, a 32.3-acre section, for future redevelopment, but no decision has been made yet about how it will be used, Mooallem said.

No development is planned for the remaining two parcels, 5.56 acres and 2.52 acres, which are water well sites that will continue to be owned and operated by Liberty Utilities, he said.

Plan ‘a real win’ for town

Oyster Bay Town Supervisor Joseph Saladino said Thursday that an Amazon facility in Massapequa would benefit the town.

“We welcome Amazon’s investment in Massapequa, which brings jobs, tax revenue, and smart reuse of a long-vacant site. This project means economic growth without the strain of a greater population on schools, roads, and services — a real win for our community,” he said in a statement.

Several residents who spoke during the public hearing, however, said they opposed an Amazon facility because of potential noise and traffic impacts to nearby neighborhoods, with some saying more study was needed before the planning commission approved the subdivision.

Some called for the mall’s owner, which bought the mall in December 2020, to be more transparent about its plans.

“I’m sure when you buy a parcel of land five years ago for $25 million, you should have some scenarios of what that parcel will be used for. … And I would ask that the owner, Urban Edge, just spend more time publicizing their potential plans,” said Gary DiBiase, 66, of Massapequa Park.

Planning Commissioner Reid Sakowich echoed that sentiment. He said he understood that a subdivision approval wouldn’t grant an approval to build, but added, “I think it’s hard for residents of that community to understand that you spent $25 million and you have no idea what you’re doing” for the redevelopment, which drew applause from about two dozen residents in the audience. 

The Town of Oyster Bay is responsible for approval of redevelopment projects in the jurisdiction.

Sunrise Mall Holdings plans to demolish the nearly vacant mall, including the free-standing former Sears Auto Center, according to a letter the partnership’s attorney, Judy Lynn Simoncic of Uniondale law firm Forchelli Deegan Terrana LLP, sent to the Town of Oyster Bay Planning and Development Department.

Dated April 2, the letter requested that the department send a zoning compliance letter to the county planning commission as part of the requirements to get the subdivision approved. 

At the planning commission meetings in Mineola on Thursday, Simoncic said it could be years before a demolition of the mall occurs.

Sunrise Mall is in Oyster Bay’s light industrial district, but the mall exists under a special-use permit granted by the town board in the 1970s, town spokesman Brian Nevin said in an email.

“Future retail space will require a special use permit from the town board. Or they could modify their existing approvals,” he said.

Changing shopping trends

Built in 1973, the 1.2 million-square-foot mall used to be a bustling property, but like many malls across the country, it has lost stores over the last decade due to a growing number of online retailers. The pandemic exacerbated the challenges faced by shopping malls.

Sunrise Mall Holdings bought the long-struggling mall from Unibail-Rodamco-Westfield, a Paris-based company, in 2020 for $29.7 million, a steep discount from the $143 million — not adjusted for inflation — that the property sold for in 2005.

When the mall’s 2020 sale was announced, the buyer said it would redevelop the property, which had a high vacancy rate of 35%. But more than four years later, no development has taken place and the only tenant left is Dick’s Sporting Goods.

Sunrise Mall Holdings stopped renewing tenant leases in 2022.

One of the last two anchors, Macy’s, recently closed.

Dick’s, which is headquartered in Coraopolis, Pennsylvania, did not respond to Newsday’s request for comment about its plans for its Sunrise Mall store. 

The retailer has more than 10 years left on its lease, said Mooallem, who has said that Macy’s exit allowed for more flexibility in redeveloping the mall.

“Macy’s, by virtue of being the largest tenant at the mall, had the most control over what other things could happen on the property. So, as a result of them leaving … we have some more flexibility,” he told Newsday in January.

Urban Edge’s partners in Sunrise Mall Holdings are Sagamore Hill Partners, a Manhattan-based real estate investment firm affiliated with Woodbury-based Ripco Real Estate, and J.G. Petrucci Co. Inc., an Asbury, New Jersey-based company that is an “established developer of industrial assets.”

With James T. Madore

Tory N. Parrish covers retail and small business for Newsday. She has worked at the Pittsburgh Tribune-Review and Observer-Dispatch in Utica, N.Y.