Builders of NYC mosque face financial hurdles

NEW YORK (AP) - The developers planning to build a $100 million Islamic center near the World Trade Center site still have financial hurdles to clear: They haven't finished buying all the property they want for the project and are nearly a quarter-million dollars behind on real estate taxes and late fees.

How serious those problems might be depends on who is backing the project - and that's still a big unknown.

The real estate partnership that controls the site of the planned cultural center, health club and mosque insists it has the financial wherewithal to put the project together, and that its failure to pay its first two quarterly property tax payments this year is not evidence of fiscal ill health.

The entity that owns the building, 45 Park Place Partners LLC, has an interest-fattened $236,327 tax bill looming on Oct. 1, according to city records.

The Manhattan real estate firm that put together the building purchase, Soho Properties, issued a statement through a spokesman that waved off concerns over the missed payments and said it's not in financial distress.

The lack of payment resulted from an ongoing dispute with the city over the assessed value of the building, the company said. In such disputes, it is not unusual for building owners to temporarily suspend payments, the company said.

"This matter will be resolved shortly," the statement said.

An Associated Press review of city tax and property databases found that hundreds of thousands of dollars in taxes due on other buildings controlled by Soho Properties and its managing partner, Sharif El-Gamal, have been paid on time this year, although in a few instances the payments were slightly less than the total owed.

El-Gamal, a Brooklyn-born Manhattan real estate investor, has put together a modest real estate portfolio over the past four years, and leads the investment group that bought the site of the planned Islamic center last summer for $4.5 million.

He has declined to identify other investors in the project, saying only that the group includes Christians, Muslims and Jews.

Soho Properties says it owns or manages about $200 million worth of real estate in Manhattan.

Its holdings include a commercial building in midtown Manhattan, luxury condominiums, and a few well-worn apartment buildings with a long history of housing code violations, many of which predated the company's purchase of the properties but have either worsened or have yet to be corrected.

The tax debt on the site of the planned Islamic center was first reported by The New York Post.

Adelaide Polsinelli, a real estate broker with Marcus & Millichap who knows El-Gamal, said she didn't consider the back taxes to be a stumbling point for the developers.

"If they were behind by years, I would be worried," she said. "That's not a big amount of money, and they're not going to lose their properties for that small of an amount."

As for the El-Gamal's wherewithal to pull off the project, Polsinelli said, "They are not novices. They have done real estate. ... The added publicity will attract investors to the deal."

The proposed center has been fiercely criticized by people opposed to the idea of an Islamic institution and mosque so close to the 9/11 site.

Half the property for the 13-story center is owned by Consolidated Edison. El-Gamal has already obtained a 99-year lease from the utility that would allow the center to be constructed without the property changing hands, but he is the process of exercising an option to buy the land outright, which will likely cost millions of dollars.

Once property ownership is wrapped up, it is unclear who would pay for the estimated $100 million cost of the new center.

El-Gamal has established a nonprofit group called Park51 to run the center, but its exact role in pushing the project forward has yet to be defined. It only began raising money on Friday.

The project's other public face, longtime Manhattan Imam Feisal Abdul Rauf, is respected by New York City leaders and has shown a knack for fundraising in the past - gathering hundreds of thousands of dollars from charities and foundations around the world to fund conferences on Islam and its relationship with the west.

Rauf's ultimate role with the project, however, is also unclear. He is a member of Park51's board and has been described as the likely head of a mosque that would be located on one of the center's floors, but he has declined interview requests for weeks while on a State Department-funded tour of Persian Gulf nations.

His wife, Daisy Khan, said Thursday that he has not been raising money for the center while on the trip. She said her husband was resting in the United Arab Emirates before returning to the U.S. this weekend.

It is unclear whether El-Gamal's for-profit real estate partnership intends to build the center itself, then lease it to Park51, or whether the nonprofit group would be in charge of fundraising and construction.

Perhaps all of the bills are easily paid, if the project attracts major donors, or if the membership of the real estate partnership have deep pockets.

But the men at the center of the deal, including El-Gamal and his brother, Sammy El-Gamal, don't act like high rollers.

Both men were waiting tables for a living a decade ago, and spent years working as brokers and property managers before recently expanding into buying buildings themselves. City records confirmed that many of the purchases were financed with sizable mortgages.

New York state Department of Taxation and Finance records showed that Sammy El-Gamal had over $20,000 in unpaid personal taxes, almost all of which dated to a period between 2000 and 2002.