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Second look: the 50% prediction, ESDC dysfunction, and Spitzer's harangue

Some news worth a second look.

Doubts from Crain's

So what about that prediction by Crain's New York Business that Atlantic Yards has only a 50% chance of being built? On reflection, I think that number is off in two ways.

First, I think that Atlantic Yards has a much less than 50% chance of being built as proposed, and in the announced ten-year timetable. If the project goes forward, it's already delayed significantly, and the difficulty in getting housing bonds, for example, would limit the delivery of affordable housing.

However, I'd bet that the Atlantic Yards arena has a greater than 50% chance of being built. The arena is developer Forest City Ratner's priority, since its construction offers an enormous upside: $400 million in naming rights, "14 totally integrated partners," 130 suites, and tremendous television revenue, all boosted by a very advantageous financing scheme, as Michael D.D. White describes on Huffington Post.

While legal and financing challenges have delayed the project, the developer and state have not yet lost in court. Forest City Ratner and parent Forest City Enterprises have a reputation for being "very disciplined" in moving forward. So it could be that Brooklyn (actually Forest City Ratner) "gets" an arena "from" Barclays long before many or any of the other promised project benefits surface.

Due diligence, benefit guarantees?

And that would raise some questions: if the Empire State Development Corporation (ESDC), in its cursory deliberation over the project, didn't consider such things as the paucity of housing bonds, could it really be said to have performed sufficient due diligence?

And should the ESDC be allowed to sign off on any financing for the project without a reasonable guarantee that the benefits beyond the arena (publicly owned but "generously leased," in the words of a federal appeals court) would arrive in a timely fashion?

ESDC dysfunction

On Tuesday, reporting on the resignation of ESDC Downstate Chairman Pat Foye, the Times described the agency as "riven by disputes between its top three executives and was regarded as dysfunctional by many real estate developers and business executives."

Such criticism hadn't publicly surfaced previously, however. Was it that the reporter finally felt comfortable providing that information, or was it that the sources finally opened up?

Spitzer's harangue

Upon the announced departure of Governor Eliot Spitzer, Atlantic Yards opponents reminded us of his severely unsympathetic posture, as Develop Don't Destroy Brooklyn legal chair Candace Carponter explained to the Village Voice:
She recalled a particularly rancorous meeting over two years ago, when Atlantic Yards opponents including herself, Goldstein and James met with the then-Attorney General and gubernatorial contender to present their community’s opposition to the project. Although Spitzer had not yet publicly expressed his support for Atlantic Yards, she says the son of a real estate developer belittled their concerns in a shouting match that ran over 20 minutes.

“I have never been berated the way we were in that room,” remembers Carponter. “He was so condescending and so dismissive – I think dismissive is probably the best word –but in an incredibly rude way.”


The story first surfaced in Ben Smith's Daily News coverage in June 2006, but everybody instead focused on Smith's revelation of DDDB spokesman Daniel Goldstein's intemperate "wealthy white masters" e-mail. Maybe the press and everyone else should've been paying more attention to Spitzer.

Though new Governor David Paterson has expressed support for AY, it's hard to imagine he won't be a little nicer toward critics and opponents. Then again, that was a big difference--along with increased transparency--between Spitzer's ESDC and the predecessor agency under Governor George Pataki.

Comments

  1. Will Atlantic Yards be built as proposed?- I don’t think so.

    - What if the people in power, (including the City Council, our politicians, the Brooklyn Heights Association) simply wise-up, realize the upper hand should belong to and be exercised by them?

    - What if the people in power, exercising the upper hand, insist the project be built according to some minimum hard-to-disagree-with principles? Then the project would be unrecognizable and Ratner would recede into the background.

    What minimum principles ought virtually anyone, any politician, anyone insist upon?

    (A big part of the below is to frustrate the indefensible Ratner preposition that he, through ruse and trickery, be the sole recipient of more $2 billion in no-bid public subsidies with the project designed with many peculiar aspects specifically tailored to make it a sponge to take subsidy away from the others to whom they should rightfully go.)

    See below, they are separated out but some lead to the others.

    1. Eliminate Megadevelopment’s Inclusion of Ward Bakery Block. - - The megadevelopment should be reduced by subtracting out the gratuitous condemnation (done for eminent domain windfall purposes) of the entire Ward Bakery Building block. (For those unaware the block has nothing to do with the arena.) In his recent political career Governor Paterson has spoken out against eminent domain abuse of the variety that was permitted under the Kelo case that went to the U.S. Supreme Court. This condemnation of the Ward Building block goes much further than Kelo style abuse and is a perfect example of the new New York style developer-initiated, developer-driven eminent domain abuse. The condemnation of this block initiated by Ratner is purely for greedy windfall profit. The block is outside a 40-year-old urban renewal area, creates an irregular boundary and was condemned side-stepping the city’s public review process for condemnations. Saving this block from condemnation will help bring the project back to an appropriate scale, save many worthwhile older buildings sorely needed by the community and allow landmarks to be preserved. It will mean helping avoid government fostered monopolistic Ratner ownership of an entire 30 acres of monoculture land. Lastly it will avoid creation of a detrimental superblock and the undesired closing of Pacific Avenue.

    2. Reduce Megadevelopment to More Appropriate Density. - - The project should be reduced to an appropriate density. The density should not be as proposed by Ratner, a density unparalleled in the North American hemisphere and that rivals the most extreme densities in Hong Kong. Ideally, the density should be set through the normal process for setting zoning density that involves community participation. It is to be acknowledged that doubling back to do this properly as the Mayor and his First Deputy Commissioner for Development say should have been done in the first place will perhaps lose time. It may be less time than will be lost with a continued pursuit of the lawsuits but people may resent the time. People may suggest that shortcuts be considered. If shortcuts are considered then, thankfully, there has already been a community process to create an alternative that has involved members of Brooklyn Speaks including the Fifth Avenue Committee, the Council, Pratt Area Community Council, and the Project for Public Spaces. That is the Unity Plan. How dense should the project area be? The Unity Plan gives good guidance from the community perspective on this point and that should be taken into account, if not followed. Alternately, across the street a new development is going up, the Atlantic Terrace project. Atlantic Terrace involves input of all the same city and state agencies that should be participating in setting the density for Atlantic Yards/Vanderbilt Yards. So maybe the answer is that the Atlantic Yards should be the same density as the publicly sponsored Atlantic Terrace across the street. If the feeling was that it needed to be denser, density could be set at 150% which would result in 15 story buildings, 180% which would result in 18 story buildings or maybe 200%.

    3. Avoid All Unnecessary Closing of Streets and Avenues. - - The closure of streets and avenues, undesirable from the public’s or a city planning point of view, is being done as a mere pretext for greater, otherwise illegal, density which should not be permitted. In terms of workability, greater density requires more, not fewer streets. The shutting down of streets and avenues is also being used to create a fictional “donation” of open space. The streets and avenue are being gifted by the City which is not receiving appropriate compensation for them.

    4. Create Valuable Additional Streets by Extending the Existing Street Grid in Obvious Ways. - - Placing extra density at the site will be a desirable thing, but no where near the density that Ratner has proposed. Extra density can work when there are extra streets and avenues. The opportunity exists to easily create those extra streets by extending the existing street grid in obvious ways. That will also break up the blocks in a way that will naturally allow them to he bid out among multiple bidders.

    5. Do Not Permit Ratner to Use the Megadevelopment as an Excuse or Mechanism to Receive No-bid Subsidy. - - Housing subsidies are scarce and need to be appropriately distributed. Ratner’s project with its super density has been designed with the idea that Ratner will soak up, without having to bid or compete for it, a great deal or all of the subsidies that would normally be available to others. That should not be permitted. Ratner should not be permitted to get any housing subsides on a no-bid basis. Accordingly, the prerequisite should be that Ratner will get no housing subsidies at all unless the various blocks and building sites upon which housing will be built are individually put out to bid. There should simply be no no-bid housing subsidies. That will also eliminate much of the below-market land price subsidy which the MTA is proposed to give Ratner and which would be inappropriate. Any bid that Ratner wins in a fairly conducted process will result in housing subsidy being able to flow to Ratner for that block, if available.

    6. Location of the Arena at the Site Should Be Scrutinized and the Arena Subsidy Should Be Cut Back to a Reasonable Level Whether or Not it Is Permitted to Remain Located at the Proposed Site. - - Robert Moses was probably right that the general area of site proposed for the arena is inappropriate from a traffic flow and congestion standpoint. The problems identified by Moses are probably accentuated by our modern day security concerns and the fact that the arena is proposed to be at a less appropriate site than the baseball stadium was once proposed to be located. So the arena should almost certainly be moved. In any event, the more than $1 billion in taxpayer subsidies that is proposed to be used to build the arena with no net out-of-pocket contribution from the developer is should not be tolerated. Under any circumstances the subsidy should be drastically reduced. The Moynihan-sponsored law that makes this kind of tax-exempt bond stadium or arena financing illegal should be observed to the letter and spirit. It should also be acknowledged that the subsidy the arena receives, if any, should be lower in amount if the arena remains situated at this high traffic location rather then being moved to a new more appropriate one.

    7. The Projects Should Be Subject to Good and Well Thought Through Design Guidelines. - - The project was rushed through with little thought. The timetable that mattered was apparently a timetable dictated by when there was going to be a change of governors in office rather the amount of time to design a good project or to get and factor in appropriate community feedback. Enough time should now be taken to implement good and well thought through design guidelines. The need will be a little less pressing if the overbearing density of the project is reduced to something appropriate but this is nonetheless important.


    And why wouldn’t the people-in-power not want to exercise the upper hand and insist on such minimum principles?

    Nothing less should be accepted from those who represent us, from those who wish to speak for us.

    ReplyDelete

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