Skip to main content

Academic: public-private partnerships in NY are one-sided

A pointed analysis of one-sided development deals from Thursday's New York Times might have led some people to think about Atlantic Yards:
“Public-private partnerships are now one-sided arrangements in which the public actors no longer plan public spaces in the public interest,” said Elliott Sclar, a professor of urban planning at Columbia University. “Instead they facilitate private-sector developments of these spaces in exchange for slight public amenities. In this case, the public gets the chance to catch a train in the basement of a vertical shopping mall.”

The critics say that given the level of public investment, tax breaks and zoning bonuses involved in the project, the city and state should be giving greater priority to the public spaces.

Oh, that was about the Moynihan Station plan, from an article headlined Big Moynihan Station Plan Is Sputtering.

And what about AY?

Are the Atlantic Yards benefits "slight public amenities"? The courts haven't had to decide. Rather, as U.S. District Judge Nicholas Garaufis wrote in his decision last June dismissing the Atlantic Yards eminent domain challenge, "This case simply does not require the court to consider whether the Project is a good idea.. the issue before this court is whether the taking of Plaintiffs’ properties is rationally related to a conceivable public use."

The Empire State Development Corporation commented, "We are pleased by the decision, which reaffirms the Atlantic Yards project's many public benefits: affordable housing, a world-class sports venue, improved transportation and increased economic activity."

Well, the affordable housing is delayed, the sports venue would be, an appeals court acknowledged, "generously leased," the improved transportation would include a new subway entrance under a shopping venue, the "urban room," and increased economic activity would be offset to a significant (though never fully calculated) degree by subsidies and public costs.


  1. I have two set of thoughts on Moynihan Station and Atlantic Yards.

    First, however relatively “slight” the “public amenities” of Moynihan Station that are being relegated in inept negotiation by the Spitzer administration, those public benefits are proportionateley far greater than any of the “conceivable” public benefits of Atlantic Yards, either in terms actual end benefit, or bang for the public subsidy dollar.

    Accordingly, after a recent 2/23/2003 New York Times article on the foundering of Moynihan Sation efforts, I wrote a letter to the Times about how public benefit dollars should be redistributed from Atlantic Yards to make possible projects such as Moynihan Station. The Times did not publish my 148 words: They publish few letters on local New York area concerns and they don’t really cover Atlantic Yards.

    My letter is as follows:

    Michael D. D. White
    62 Montague Street, Apt. 3A/3E
    Brooklyn Heights, New York 11201

    February 23, 2008
    Via Fax- (212)556-3622

    Letters to the Editor
    The New York Times
    620 Eighth Avenue
    New York, NY 10018
    Re: Moynihan Station and legacy/ "Plan to Rebuild Penn Station Area May Be Close to Failure," By Charles V. Bagli, February 23, 2008
    To the Editor:

    If Moynihan Station, richly merited and full of public purpose, dies for lack of political will to marshal funding, the irony is supreme. This Moynihan legacy may have been sacrificed because we did not honor another Moynihan legacy. In 1986, Senator Daniel Patrick Moynihan sponsored an insightful law banning tax-exempt bonds to finance sports stadiums and arenas. Now, because this law has been creatively circumvented, Forest City Ratner is using a proposed Nets arena to divert more than $1.5 billion of public subsidy into its Atlantic Yards no-bid megadevelopment. Real estate taxes will be intercepted to pay $692.7 million of arena bonds. . . tax-exempt bonds on which over $125 million in city, state and federal income taxes won't be paid.

    If the public recaptures these ill-conceived subsidies proposed for Atlantic Yards, the city and state can substantially increase their respective $300 million contributions to Moynihan Station.


    Michael D. D. White

    My second thought about Moynihan Station is that, as the "Big Moynihan Plan is Sputtering" article linked to makes clear, Moynihan Station has turned into essentially two possible projects. One is the simple, more straightforward project that might have been labeled a “Pataki” achievement if Spitzer had not stopped it going through the PACB just before Pataki’s term as governor ended. The other is a more complex mega-project that could be labeled a “Spitzer” achievement if he ever gets it unbollixed. Spitzer was apparently approached and decided to shift over to the mega-development style version of the Moynihan deal during his gubernatorial campaign.

    The Times accepts only 150 word letters so I had to stick to one point when I wrote, but
    if I had more words available to me (like now) I would probably have pointed out how Spitzer is failing in his Moynihan Station negotiations.

    When Spitzer intercepted the Pataki plan, I gave Spitzer some benefit of the doubt that he had a better idea about a few additional good options that could be accomplished with some simple tweaking. That wasn’t the case. Moynihan Station is like Atlantic Yards in that Spitzer has bollixed himself up by taking his eye off the ball of public benefit in the course of negotiations. We'd be much better off in terms of getting a truly commendable Moynihan Station if Spitzer had followed the KISS (“Keep It Simple Stupid”) rule and strictly focused of the core public benefit goals of a station with good design.- Instead, Spitzer got drawn into negotiating with the developers in a big mega-scheme where the game theoretically had to play out on the playing field and terms of a big developer. As a result the big developer’s goals have taken over and are inappropriately predominating. Like Atlantic Yards, Moynihan Station doesn’t involve, though it could, simple component parts where developers can be required to bid against each other toward a firmly established bottom line goal for public benefit.

    I don’t know what overtures made it seem to Spitzer and his people that accepting the invitation onto the big developer’s playing field was a good idea but it hasn’t worked out for the public.


Post a Comment

Popular posts from this blog

Forest City acknowledges unspecified delays in Pacific Park, cites $300 million "impairment" in project value; what about affordable housing pledge?

Updated Monday Nov. 7 am: Note follow-up coverage of stock price drop and investor conference call and pending questions.

Pacific Park Brooklyn is seriously delayed, Forest City Realty Trust said yesterday in a news release, which further acknowledged that the project has caused a $300 million impairment, or write-down of the asset, as the expected revenues no longer exceed the carrying cost.

The Cleveland-based developer, parent of Brooklyn-based Forest City Ratner, which is a 30% investor in Pacific Park along with 70% partner/overseer Greenland USA, blamed the "significant impairment" on an oversupply of market-rate apartments, the uncertain fate of the 421-a tax break, and a continued increase in construction costs.

While the delay essentially confirms the obvious, given that two major buildings have not launched despite plans to do so, it raises significant questions about the future of the project, including:
if market-rate construction is delayed, will the affordable h…

Revising official figures, new report reveals Nets averaged just 11,622 home fans last season, Islanders drew 11,200 (and have option to leave in 2018)

The Brooklyn Nets drew an average of only 11,622 fans per home game in their most recent (and lousy) season, more than 23% below the announced official attendance figure, and little more than 65% of the Barclays Center's capacity.

The New York Islanders also drew some 19.4% below announced attendance, or 11,200 fans per home game.

The surprising numbers were disclosed in a consultant's report attached to the Preliminary Official Statement for the refinancing of some $462 million in tax-exempt bonds for the Barclays Center (plus another $20 million in taxable bonds). The refinancing should lower costs to Mikhail Prokhorov, owner of the arena operating company, by and average of $3.4 million a year through 2044 in paying off arena construction.

According to official figures, the Brooklyn Nets attendance averaged 17,187 in the debut season, 2012-13, 17,251 in 2013-14, 17,037 in 2014-15, and 15,125 in the most recent season, 2015-16. For hoops, the arena holds 17,732.

But official…

At 550 Vanderbilt, big chunk of apartments pitched to Chinese buyers as "international units"

One key to sales at the 550 Vanderbilt condo is the connection to China, thanks to Shanghai-based developer Greenland Holdings.

It's the parent of Greenland USA, which as part of Greenland Forest City Partners owns 70% of Pacific Park (except 461 Dean and the arena).

And sales in China may help explain how the developer was able to claim early momentum.
"Since 550 Vanderbilt launched pre-sales in June [2015], more than 80 residences have gone into contract, representing over 30% of the building’s 278 total residences," the developer said in a 9/25/15 press release announcing the opening of a sales gallery in Brooklyn. "The strong response from the marketplace indicates the high level of demand for well-designed new luxury homes in Brooklyn..."

Maybe. Or maybe it just meant a decent initial pipeline to Chinese buyers.

As lawyer Jay Neveloff, who represents Forest City, told the Real Deal in 2015, a project involving a Chinese firm "creates a huge market for…

Is Barclays Center dumping the Islanders, or are they renegotiating? Evidence varies (bond doc, cash receipts); NHL attendance biggest variable

The Internet has been abuzz since Bloomberg's Scott Soshnick reported 1/30/17, using an overly conclusory headline, that Brooklyn’s Barclays Center Is Dumping the Islanders.

That would end an unusual arrangement in which the arena agrees to pay the team a fixed sum (minus certain expenses), in exchange for keeping tickets, suite, and sponsorship revenue.

The arena would earn more without the hockey team, according to Bloomberg, which cited “a financial projection shared with potential investors showed the Islanders won’t contribute any revenue after the 2018-19 season--a clear signal that the team won’t play there, the people said."

That "signal," however, is hardly definitive, as are the media leaks about a prospective new arena in Queens, as shown in the screenshot below from Newsday. Both sides are surely pushing for advantage, if not bluffing.

Consider: the arena and the Islanders can't even formally begin their opt-out talks until after this season. The disc…

Skanska says it "expected to assemble a properly designed modular building, not engage in an iterative R&D experiment"

On 12/10/16, I noted that FastCo.Design's Prefab's Moment of Reckoning article dialed back the gush on the 461 Dean modular tower compared to the publication's previous coverage.

Still, I noted that the article relied on developer Forest City Ratner and architect SHoP to put the best possible spin on what was clearly a failure. From the article: At the project's outset, it took the factory (managed by Skanska at the time) two to three weeks to build a module. By the end, under FCRC's management, the builders cut that down to six days. "The project took a little longer than expected and cost a little bit more than expected because we started the project with the wrong contractor," [Forest City's Adam] Greene says.Skanska jabs back
Well, Forest City's estranged partner Skanska later weighed in--not sure whether they weren't asked or just missed a deadline--and their article was updated 12/13/16. Here's Skanska's statement, which shows th…

Not just logistics: bypassing Brooklyn for DNC 2016 also saved on optics (role of Russian oligarch, Shanghai government)

Surely the logistical challenges of holding a national presidential nominating convention in Brooklyn were the main (and stated) reasons for the Democratic National Committee's choice of Philadelphia.

And, as I wrote in NY Slant, the huge security cordon in Philadelphia would have been impossible in Brooklyn.

But consider also the optics. As I wrote in my 1/21/15 op-ed in the Times arguing that the choice of Brooklyn was a bad idea:
The arena also raises ethically sticky questions for the Democrats. While the Barclays Center is owned primarily by Forest City Ratner, 45 percent of it is owned by the Russian billionaire Mikhail D. Prokhorov (who also owns 80 percent of the Brooklyn Nets). Mr. Prokhorov has a necessarily cordial relationship with Russia’s president, Vladimir V. Putin — though he has been critical of Mr. Putin in the past, last year, at the Russian president’s request, he tried to transfer ownership of the Nets to one of his Moscow-based companies. An oligarch-owned a…