Monday, May 19, 2008

More evidence about AY as a developer-driven project

More than a year ago, on 2/27/07, I wrote about how, despite claims by Forest City Ratner's lawyers that the developer did not conceive of Atlantic Yards, evidence suggested otherwise.

Let's look at two pieces of additional evidence, which seem to contradict each other. When the project was announced, a 12/11/03 New York Times article, headlined A Grand Plan in Brooklyn For the Nets' Arena Complex, reported:
Mr. [Bruce] Ratner said his effort began after [Borough President] Mr. [Marty] Markowitz called urging him to buy the Nets and move the team to Brooklyn.


The implication is that only upon the sale of the Nets did Ratner begin to consider development at the railyards.

"Next great site in Brooklyn"

But consider some more evidence of a developer-driven project. It's from a 9/9/05 Q2 2005 Forest City Enterprises, Inc. Earnings Conference Call (for sale) that representatives of parent Forest City Enterprises (FCE) had with investment analysts.

Chuck Ratner, CEO of FCE, said:
I will confess that it was less than two or three years ago we were sitting around in New York wondering where the next deals were going to come from. We had finished a whole bunch of office and we completed MetroTech and we didn't have the next great site in Brooklyn. That was one of the reasons we got so aggressive and creative, Bruce and his team did in this Atlantic Yards project. We saw that land sitting there for this last 10 years, realizing it would be a great opportunity if somebody could turn it on. We hope we've found a way to do that.

AY appeal

That sequence may be relevant to the pending appeal of the AY eminent domain case at the Supreme Court. (The court is still awaiting briefs on whether to even accept the case for consideration.)

In a decision issued 2/1/08, a federal appeals court waved away the plaintiffs' argument that, unlike in the Supreme Court's Kelo v. New London decision (which upheld eminent domain for economic development rather than addressing the broader justifications cited in the AY case), Atlantic Yards was proposed by the developer rather than the result of a response to an RFP.

The court stated: However, here, New York long ago decided by statute not to restrict the ESDC’s [Empire State Development Corporation] mandate to those “projects in which it is the prime mover.”

That's true, as I pointed out, but the court didn't address Supreme Court Justice Anthony Kennedy’s observation in his nonbinding Kelo concurrence that the case was legitimized by “the substantial commitment of public funds by the State to the development project before most of the private beneficiaries were known” and “evidence that respondents reviewed a variety of development plans and chose a private developer from a group of applicants rather than picking out a particular transferee beforehand.”

Both those conditions were absent in the Atlantic Yards sequence. Whether the Supreme Court considers them significant we should know within a few months.

No comments:

Post a Comment