East Northport assisted-living facility receives Suffolk IDA tax breaks
Rendering of an 86-unit assisted-living and dementia care facility proposed for Pulaski Road in East Northport. Credit: Sunrise Senior Living Management
An assisted-living and dementia-care facility is moving forward in East Northport after receiving approval for tax breaks Thursday from the Suffolk County Industrial Development Agency.
Silver Fox Senior Living plans to invest $112 million in an 86-unit complex at 1381-1387 Pulaski Rd. to address the health and housing needs of Long Island's aging population.
The project is expected to break ground early next year and open in 2028. After construction, national operator for-profit Sunrise Senior Living will manage the facility, its 11th on Long Island, with another location planned in Oceanside.
The IDA's assistance will help Silver Fox manage the high cost of construction and property taxes on Long Island in the years before the building fills up with rent-paying residents, said David Curry, Silver Fox's attorney and a partner at Farrell Fritz in Uniondale.
"Without these benefits, the project will not be built, and the town and county will lose a much-needed project and the injection of over $110 million in local investment," Curry said at the meeting.
Separately, the Suffolk County Economic Development Corp. approved issuing tax-exempt bonds to cover the entire construction cost, providing the nonprofit Silver Fox access to lower-cost financing.
The two-story, 72,000-square-foot building will include 64 assisted-living units and 22 memory-care units.
Silver Fox estimated the project would generate 453 construction jobs and 54 permanent jobs by its second year of operation. Those jobs are expected to pay about $66,000 on average.
The project will address the needs of aging Suffolk County seniors while creating local jobs, said Peter G. Ganley III, the IDA's acting CEO and executive director.
The IDA approved a sales tax exemption valued at nearly $2.9 million, and a 15-year payment in lieu of taxes agreement, or PILOT, that saves the owner nearly $1.8 million in property taxes compared to the full assessment.
Over the 15 years, Silver Fox will make $4.6 million in payments, or 72% of the full taxes. Those payments represent a significant increase from the roughly $837,000 the Suffolk IDA anticipated the current property owner would pay during the 15-year period.
A different Sunrise-affiliated entity received authorization for tax breaks from the Suffolk IDA in 2022, but ultimately didn't use the exemptions because it failed to raise financing, according to IDA documents.
Last month, the investment firm BDT & MSD Partners, which counts billionaire Michael Dell among its investors, agreed to acquire a majority stake in privately-held Sunrise Senior Living for $1 billion, The Wall Street Journal reported. The deal is expected to close in 2027.
The Northport-East Northport School District expressed concerns about the tax abatement and urged the IDA to consider the cumulative burden of tax abatements it has issued in the area, Superintendent Dave Moyer wrote in a letter to the IDA. The IDA said during the meeting it has one other active PILOT agreement in the area with The Northport Hotel.
"The school district is concerned that the proposed abatement shifts costs away from the project and onto taxpayers who do not receive any corresponding benefit," he wrote.
Representatives from the Melville-based Laborers Local 66 and Ronkonkoma-based Plumbers Local Union No. 200 spoke in support of the project at Thursday’s meeting and expressed interest in their members working on the facility.
Despite Sunrise's national scale, with about 240 communities, the financial assistance is necessary to attract investment to East Northport, said Curry, the applicant's attorney.
“Developers look at the numbers and they say, ‘This doesn’t make sense. We’re going to deploy our capital elsewhere,' ” Curry said in an interview. “Then things don’t get built here, and Long Island doesn’t move forward. The IDA’s role here is crucial."
Jonathan LaMantia covers residential real estate and other business news on Long Island. He previously covered the business of health care for Crain's New York Business.
Luxe apts. got tax break without affordable housing ... Suburban voters and midterms ... LI employs 90% of highest paid government employees ... County on hook for $70M for dangerous intersection
Luxe apts. got tax break without affordable housing ... Suburban voters and midterms ... LI employs 90% of highest paid government employees ... County on hook for $70M for dangerous intersection
