Tuesday, January 3, 2012

With Citizens Bank suit settled, O’Neill moves ahead with Worthington

by Natalie Kostelni
"O’Neill Properties Group and Citizens Bank of Pennsylvania have settled the lawsuits each brought against each other.

Here’s a statement put out by O’Neill and the bank: “Citizens Bank of Pennsylvania and Brian O’Neill of O’Neill Properties Group jointly announce that they have entered into a settlement agreement resolving all litigation between them. The terms and conditions of the settlement are confidential.”

The litigation centered on O’Neill’s Uptown Worthington project in Malvern and Citizens winning a $61 million judgment against the developer. O’Neill countered with its own lawsuit.

A settlement has long been rumored and it’s nice that it finally arrived. Maybe it’s a harbinger of what’s to come this year with commercial real estate: Lenders cleaning up their books, coming to terms on loans and other issues and allowing the industry to start moving some dirt around. What it means for O’Neill is ramping up development at Worthington again.

“We’re going to do it all,” said Brian O’Neill in an interview this morning about Worthington. “We’re out moving and shaking. Tenacity is a rewarding virtue.”

Eight percent, or 35, of the retail tenants who wanted to lease space at the development before the economy tanked are negotiating to return, O’Neill said. After not opening any or many new stores during the recession, retailers are now under pressure to open up sites in proven locations, he said.

Worthington already has Target and Wegmans, which appear to be busy, and O’Neill said they are ringing in record sales. The development also has its infrastructure in place, making it attractive for retailers who don’t want wait for a site to be ready.

O’Neill plans to soon begin construction on the first phase of an apartment complex that will total 750 units at build-out. The first phase will be comprised of 250 apartments.

The company started construction on a pad for a PNC Bank branch and is negotiating with tenants on four other pads. As for office development, O’Neill is in negotiations with a “major” tenant on a 145,000-square-foot building.

“It’s a $400 million project,” he said. “All told, it will be over 1 million square feet. We’re very happy to be moving forward with this project. It’s a winner.”

The developer is confident it will be able to line up funds to finance the work that is expected to get underway.

“The markets are loosening up and are out doing deals,” he said, noting his company is in discussions with numerous lenders."

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