Tuesday, April 04, 2006

"Coming way back"? FCR disses Gehry's prediction, lies twice in press release

Two important facts have been ignored so far in press coverage of Forest City Ratner's announcement that it has reduced the scale of the Atlantic Yards project by 5% compared to its previous iteration: the developer has repudiated the words of architect Frank Gehry and falsely claimed that the project has shrunk from its original version.

The reduction in scale is 475,000 square feet, or 23 floors in 16 buildings. Most of the reduction would be in residential space--cutting 440 of the 2800 proposed market-rate condos--with small cuts in proposed hotel, office, and retail space.

The Draft Scope of Analysis, issued by the Empire State Development Corporation last September, proposed 9.132 million gross square feet; the Final Scope of Analysis--a prelude to a Draft Environmental Impact Statement--proposes 8.659 million gross square feet. The reduction is a little over 5%.

However, the original plan, announced in December 2003, proposed 7.7 million zoning square feet. (Emphasis added.) The amount in gross square feet would be slightly higher--though Forest City Ratner hasn't explained that in its p.r. materials. [Addendum: not in its public p.r. materials. The company explained to the New York Observer that "the 2003 proposal was for 8 million gross square feet (7.7 million zoning square feet), while it now stands at 8.659 million gross square feet (8.3 million zoning square feet)."]

The Times, in a 4/1/06 article headlined Arena Complex Shrinks by 5% in Latest Plan, indicated that the current iteration is "still nearly half a million square feet larger" than the original design. That suggests that the original plan was over 8 million gross square feet.

What's clear is this: the developer proposed a huge project, made it bigger, than scaled it back modestly and claimed it had been responsive to community concerns. That's hardly an unusual scenario in the development game.

Repudiating Gehry

Was project architect Frank Gehry on board? At a 1/7/06 appearance in New York. Gehry asserted that there would be major changes:
We've been playing with the scale. The pictures you saw in the New York Times [7/5/05], the way it looked--it's not that big. It’s big, but not that big. It’s coming way back, in a lot of areas, and I guess something will go public in the next few months.

A 5% reduction hardly represents "coming way back." It would be interesting to hear what Gehry thinks. Or was he simply told to stop arguing for changes?

Perhaps Forest City Ratner is considering another iteration of the project, which would be scaled down a bit more. That would allow the developer to again portray itself as responsive to community concerns.

Original design scaled down?

The company press release contained two lies in one sentence:
"For nearly three years, and long before the formal review of the project began last fall, we have been meeting with elected officials, community leaders and civic and local organizations to incorporate their ideas into the Atlantic Yards project," said Bruce Bender, Executive Vice President for Governmental and Public Affairs for FCRC. "From these meetings we developed the city's first Community Benefits Agreement, shifted commercial space to more residential space, and have identified innovative ways to scale down the original design to better meet the needs of the borough and the surrounding communities.
[Emphasis added.]

First, the original design has not been scaled down. It has been increased, and none of the coverage so far (the Times, the New York Daily News, the New York Post, and the New York Observer) pointed out Bender's lie. Given that he was talking about meetings over three years, he could not have been claiming that the September 2005 design was the "original design."

Why less office space?

The second lie came when Bender said that the civic meetings caused the developer to have "shifted commercial space to more residential space." Was Forest City Ratner meeting with community activists and elected officials who clamored for market-rate condos? There's no record of that.

Rather, the Times reported last November:
Officials of Forest City Ratner said they eventually realized that they would have to reduce the amount of commercial space, to accommodate condominium units that would help pay for the project, including the below-market rental housing.

(I pointed out how the word "eventually" was disingenous.)

Information vs. contention

In two cases, reporters relied on critics to point out that the project remained larger than the original iteration, rather than establishing it out as a basic fact. (The Post and the News ignored the issue completely.)

More egregiously, New York 1 reported that project opponents Develop Don't Destroy Brooklyn were "arguing that the plans have actually ballooned over the last two years."

It's not an argument.

The Times reported, in the ninth paragraph of the story: Critics also noted that the project is still nearly half a million square feet larger than it was when Forest City Ratner unveiled preliminary plans in 2003.

That's an unusual locution, because critics--at least Develop Don't Destroy Brooklyn, the main opposition group--were arguing that the project was a million square feet larger (by citing the zoning square feet figures originally promulgated by Forest City Ratner).

More importantly, why is it up to critics to point out a basic fact? The article began:
The developer of Brooklyn's biggest real estate project in recent history announced yesterday that it would reduce its size, granting some concessions to critics who have said that it would overwhelm the surrounding neighborhood.

The lead could easily have accommodated an additional sentence:
Still, the project would be larger than originally announced in December 2003.

More office space possible?

In the New York Observer's blog The Real Estate, Matthew Schuerman pointed out, in a post headlined Ratner's "Downsizing" Could Upsize Office Space that there are actually two variations in the Final Scope issued by the ESDC: "[V]ariation A would have 6,860 condos and rentals and 606,000 square feet of offices. Variation B would have 5,790 apartments and 1.8 million square feet of offices."

He added:
The original scoping document, issued last fall, did leave open the possibility that Ratner may want to increase commercial space, but it did not provide numbers. It may be that this latest revision reflects nothing more than the E.S.D.C. deciding that it should lay everything out on the table.
Or, if one is a conspiracy theorist, the revision was part of a calculated move to secure Assembly Speaker Sheldon Silver's support and then betray him: Ratner shifts from office to condos around the time Silver starts acting protective about the office market in his Lower Manhattan district. Then Silver pitches in $33 million from the state budget, and the same week (maybe even same day), Ratner suggests he might go back toward offices after all. We know "betray" is a strong word here: Surely Ratner will need Silver's help in the future and does not want to ruffle his feathers.


A conspiracy theorist would have to confront issues of timing. According to a legal filing by the ESDC, the Final Scope of Analysis was expected to be issued by mid-March, but delayed because of the legal wrangle over whether attorney David Paget, who had just advised the developer, could work for the state agency. A conspiracy theorist would have to think that Forest City Ratner welcomed the delay, because otherwise the Final Scope would have been issued before the state budget came to a vote.

The market for high-end condos seems to be tightening, as Lumi Rolley points out in NoLandGrab. But at the same time office space in Brooklyn would be competing with a glut in Lower Manhattan--and the market for office space in nearby Downtown Brooklyn has shrunk as well.

Would Forest City Ratner further shrink the project in response to market forces? How many tenants/owners do they need to earn their desired profit? We don't know.

Putting Marty on the spot

The Times was the only press outlet so far to put Markowitz, who "pronounced himself 'delighted' by the revised plans," on the spot. "Mr. Markowitz, who had previously urged Forest City Ratner to reduce the scale of the buildings, would not yet say whether he believed the project had shrunk enough."

Since the Draft Scope of Analysis was released in mid-September, Marty's had more than half a year to form an opinion on how big the project should be.

41% affordable at best?

The 4500 rental units in the project would remain as planned, with half designated as affordable; ACORN's Bertha Lewis praised Forest City Ratner for maintaining its commitment to affordable housing, but didn't assert, as she has in the past, that the entire project would be 50% affordable.

The numbers now would be 4610 market-rate units on site, plus 2250 affordable units to low-, moderate-, and middle-income renters. That would be 32.7% affordable units onsite.

Ratner has promised 600 to 1000 affordable for-sale units, on or offsite, though the plans released last week give no indication that they would be onsite. If the developer builds the maximum 1000 affordable condos offsite, that would make 41.3% of the entire project's residential units affordable. If 600 units were built, the percentage would be 38.2%. That's not 50 percent.

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