Wednesday, December 31, 2008

Forest City Ratner's lean new web site emphasizes completion of projects

Maybe the truncated new web site for Forest City Ratner, currently just two pages, embodies current lean times. Or maybe the site, which offers less information than its previous incarnation, is just a work in progress, with links coming to projects like Atlantic Yards and Ridge Hill.

(Fun fact: Ridge Hill offers December 2008 construction updates; Atlantic Yards does not.)

Either way, it's notable that FCR now prominently cites its history as "a firm that consistently takes on and completes large, complex mixed-use projects"--a statement that reinforces the company's intention to ultimately forge ahead with the Atlantic Yards project.

(Click on all graphics to enlarge.)

The new web site

The home page offers an aerial photo of MetroTech in Downtown Brooklyn:
Forest City Ratner Companies, a wholly owned subsidiary of Forest City Enterprises, has developed, and currently owns and operates, 11 million square feet of commercial property in the New York metropolitan area, including office, retail and residential. Forest City Enterprises, Inc., based in Cleveland, is one of the largest publicly traded real estate firms in the U.S.

The About Us page is free of graphics:
One of the foremost urban real estate developers in the New York metropolitan area, Forest City Ratner Companies (FCRC) maintains a strong commitment to developments that enhance local communities and encourage economic development. Based in Brooklyn, FCRC is a full-service, vertically integrated real estate company with expertise in all facets of development: finance, land use, design, engineering, construction, leasing, government approvals and building operations. It is well known as a firm that consistently takes on and completes large, complex mixed-use projects.
(Emphasis added)

The old web site (via the Internet Archive)

The home page

The map of projects
The mission statement:
Forest City Ratner is an owner and developer of real estate, committed to building superior, long-term value for its stakeholders. We accomplish this through the development and operation of commercial, retail, hotel and urban entertainment projects. We operate by developing meaningful relationships and leveraging our entrepreneurial capabilities with creative talent in a fully integrated organization. Forest City Ratner is both firmly grounded in the wisdom of experience and inspired by the persistence of technological innovation.

The company overview previously touted a steady track record: Since the late 1980’s, FCRC has been the only developer to create major public projects for New York City at an average rate of nearly one million square feet of new construction each year.

The company leadership

A compilation of news items

A compilation of press releases

Bruce Ratner's bio, currently missing from Forest City Ratner's web site

Just in case Bruce Ratner's bio--which was apparently written in 2004--doesn't reappear on the revamped Forest City Ratner web site, here's a look at the old one, courtesy of the Internet Archive. The screen shot captures only part of the text, which is reproduced below.

BRUCE C. RATNER Chairman and Chief Executive Officer

Bruce C. Ratner is Chairman and Chief Executive Officer of Forest City Ratner Companies (FCRC). Under Mr. Ratner’s leadership, FCRC has become one of the foremost urban real estate developers in the New York metropolitan area.

After graduating cum laude from Harvard College in 1967 and receiving a law degree from Columbia University School of Law in 1970, Mr. Ratner joined the administration of Mayor John Lindsay as the director of a Model Cities program and later as the head of the Consumer Protection Division of the Department of Consumer Affairs. Following a four-year stint as a professor at New York University Law School, Mr. Ratner returned to government as the Commissioner of Consumer Affairs under Mayor Edward Koch, where he was responsible for designing major initiatives in consumer-fraud protection that became models for subsequent national legislation.

While at Consumer Affairs, Mr. Ratner also became interested in how major national retail outlets had long underserved inner-city residents and how the city itself had failed to utilize major business and transit hubs to offset corporate flight to New Jersey and the surrounding suburbs. These interests, along with a broader commitment to projects that enhance local communities, remain a driving force within FCRC.

One Pierrepont Plaza, which opened in 1988, was the first new office construction in downtown Brooklyn in a quarter of a century. The project, which was the first undertaken by FCRC, helped define what has since become New York City’s third central business district and contributed to what today is considered the “Brooklyn renaissance.” Since then, Mr. Ratner and FCRC have steadily developed MetroTech Center, a $1 billion, 16-acre campus with 14 buildings in the heart of downtown Brooklyn, which now hosts 20,000 jobs in its 6.4 million square feet of commercial, academic and high-tech office space.

Atlantic Center, a 400,000-square-foot shopping mall that opened in Brooklyn in 1996, adjacent to the Atlantic Terminal transportation hub, grew out of Mr. Ratner’s desire to bring major national retail outlets to a historically underserved part of the city. In 2005 Mr. Ratner expanded on this vision and finished the Atlantic Terminal Office and Retail Complex, a 10-story, 350,000-square-foot office building constructed above a four-story, 470,000-square-foot retail shopping center, located next door to Atlantic Center. The Bank of New York serves as the anchor tenant of the Atlantic Terminal office building, occupying 320,000 square feet and providing offices for 1,500 employees. The retail center’s anchor tenant, Target, occupies 194,000 square feet on three floors.

On a site adjacent to Atlantic Center, Mr. Ratner is preparing to construct Atlantic Yards, a 7.7 million-square-foot mixed-use development designed by internationally acclaimed architect Frank Gehry. Encompassing 8 acres of public open space, more than 2 million square feet of commercial space and more than double that amount of residential space—at a variety of price points, including affordable housing—Atlantic Yards will be anchored by the 800,000-square-foot, 18,000-seat Barclays Center arena, designed to be the home of the Nets professional basketball team, recently purchased by a group of investors led by Mr. Ratner.

Beyond Brooklyn, which is also home to Forest City Ratner Companies, FCRC continues to create major retail projects throughout the city and the metropolitan area. In Manhattan, FCRC developed the headquarters for the New York Mercantile Exchange in lower Manhattan, near the World Financial Center. FCRC played a key part in the rebirth of Times Square with the 42nd Street Entertainment and Retail Complex, a 335,000-square-foot development that features a 25-screen AMC Cineplex and a Madame Tussaud’s Wax Museum, topped with a 25-story, 455-room Hilton Hotel with sky-lobby restaurant. Forest City joined forces with The New York Times Company to build the newspaper’s new headquarters near Times Square, a 1.5 million-square-foot structure that includes approximately 700,000 rentable square feet of Class A office space. Designed by renowned architect Renzo Piano, the 52-story building is the first high-rise in the U.S. to feature an all-glass curtain wall with a sunscreen made of ceramic rods. In Battery Park City, FCRC developed a 617,000-square-foot mixed-use complex that includes a 14-story Embassy Suites Hotel, retail stores and a 4,000-seat, 16-screen United Artists Theater. Additional FCRC projects include The Shops at Bruckner Boulevard in the East Bronx; the Shops at Gun Hill Road in the Pelham Gardens/Baychester section of the Bronx; the Shops at Northern Boulevard in Woodside, Queens; Columbia Park in North Bergen, New Jersey; The Heights on Court Street in Brooklyn, and The Stores at Richmond Avenue on Staten Island.

Other FCRC projects under development include lower Manhattan’s 76-story Beekman Tower, designed by world-famous architect Frank Gehry with a glass-and-titanium curtain wall. Most of the building will house luxury residential units. In East Harlem, FCRC has teamed up with Blumenfeld Development Group to transform the former Washburn Wire Factory into East River Plaza, a 485,000-square-foot shopping complex just off the FDR Drive. And in Westchester County, Mr. Ratner is developing Ridge Hill, a mixed-use project that will include some 1.3 million square feet of retail space, 160,000 square feet of office and research facilities, and up to 1,000 mixed-income apartments, all arranged around a landscaped town square.

As a company, FCRC strives to be a responsible corporate neighbor that contributes to the betterment of the community. FCRC has maintained a goal of 14 percent minority-owned business and 9 percent women-owned business participation on all of its construction projects without government-mandated goals, and usually exceeds those percentages. Through the Community Labor Exchange, an aggressive community involvement program, all contractors on FCRC projects make one of every four field construction job slots available for a community hire.

On a personal level, Mr. Ratner is also a firm believer in giving back to the community. Mr. Ratner engages in philanthropic endeavors that promote social justice, a spirit of community and an improved quality of life. As such, he provides time, energy and financial support to educational and cultural institutions.

A supporter of the arts, Mr. Ratner works extensively with the world-renowned Brooklyn Academy of Music (BAM). He has been a BAM trustee since 1989 and was the chairman of its board from 1992 until 2001. As a result of his involvement with BAM, Mr. Ratner also created the MetroTech Downtown Fund, which encourages contributions to the arts from companies moving into Brooklyn.

In 1994, Mr. Ratner was the recipient of the New York State Governor’s Arts Award. Two years later the Metropolitan Museum of Art elected him as a trustee.

Mr. Ratner is a firm believer in the value of education. He has served as vice chairman of the board of Long Island University, and he sits on the board of The Futures in Education Foundation (a foundation for the preservation of Catholic education). Mr. Ratner and Forest City Ratner also support a number of educational programs throughout the city, including the Promise Scholarship Fund of Polytechnic University and the Brooklyn Bureau of Community Service. He is an overseer of the Weill Cornell Medical College and is on the board of the Memorial Sloan Kettering Cancer Center. In 1996, Mr. Ratner received an honorary Doctorate of Law from Pratt Institute.

Mr. Ratner is a strong advocate for New York City’s park system, believing that our parks play a crucial role in economic development and in enhancing the urban environment. He is currently a board member of the City Parks Foundation. He also serves on the boards of the Brooklyn Chamber of Commerce, the International Rescue Committee and the Museum of Jewish Heritage/A Living Memorial to the Holocaust.

As a member of the board of directors of the New York City Partnership, Mr. Ratner was heavily involved in framing the debate over economic development issues in the New York region. A report he wrote, “Marketing New York City in the Global Economy,” triggered the partnership’s initiative in promoting international investment. Mr. Ratner was also a panelist on urban issues at President Clinton’s Economic Summit in December 1992.

Born on January 23, 1945, Mr. Ratner has two daughters: Rebecca graduated from Brown University in 1995 and Elizabeth from Harvard College in 1997.

Tuesday, December 30, 2008

At home, Nets attendance finally increases

The attendance at the last three New Jersey Nets home games has picked up considerably, with an announced crowd of 16,203 (81.1% of 19,968) on December 22, 16,852 (84.4%) last Friday, and a crowd of 18,786 (94.1%) last night.

Even if that's just tickets distributed rather than gate count, it's a return to some higher numbers posted earlier in the season and an increase from a previous average that nudged above 15,000.

Photos from last night indicate few empty seats, though those from Friday indicate a good number of cheap seats empty. Note that the announced attendance was 16,722 when the Nets hosted the Knicks December 10; I attended and estimated a 25% fudge factor.

Last year, attendance picked up around the holiday season, as well. But if the Nets sustain some increased attendance, despite the team's surprisingly bad home record (contrasted with its strength on the road), one factor might be the team's effort to distribute free or low-cost tickets.

"My humble fiction": Markowitz imagines lost opportunity for AY compromise, posits arena as corporate magnet

In his now-traditional end-of-the-year interview with the Brooklyn Paper's Gersh Kuntzman, Borough President Marty Markowitz offers some curious comments on Atlantic Yards, notably the suggestion that project opponents missed an opportunity to compromise on a smaller project, and that the presence of a basketball team would draw corporations to Brooklyn.

Those, I submit, are "humble fictions," the counterpoint to Markowitz's catch-phrase, "in my humble opinion."

More soberly, he bows somewhat to reality by acknowledging that the project could take "12 to 16 years" to build. That's a distinct contrast with the approved ten-year construction timeline, which was reiterated by Forest City Ratner CEO Bruce Ratner this past May, but it doesn't acknowledge that the State Funding Agreement gives the developer 12+ years to build Phase 1 and imposes no deadline for Phase 2.

Markowitz also puts in a few words for the "mend-it-don't-end-it" BrooklynSpeaks coalition, which, while slumbering, could still supply a framework for tweaking the project design and government oversight.

While the Brooklyn Paper's transcript is extensive, the comments on BrooklynSpeaks and other matters are not included, so I listened to the podcast and augmented the excerpts quoted below. The relevant passage starts at about 16:30.

Projects slowed

GK: The economy is affecting development, especially here in Downtown Brooklyn. What are you seeing out there?

MM: Getting credit is very difficult, but construction costs are beginning to come down. … When I look at Fourth Avenue, it doesn’t take a rocket scientist to know that not everything is selling out. It’s also true on Flatbush Avenue and it’s also true on Eastern Parkway at the Richard Meier building and I’m sure we can look at other examples.

GK: That’s true of individuals. But it’s true about developers, too. We have developers who haven’t started projects.

MM: We saw that with the Clarett Group on Court Street, as an example. And Atlantic Yards, though the lawsuits have prevented it. Those people who want to stop it did not know the economy was going to turn. They got lucky that the economy turned. But the truth of the matter is that, had it not been for the law cases, had it just been starting now... there still would be a problem today in terms of the credit market.... It has slowed down dramatically.

Reduced commitment

GK: Forest City Enterprises, the parent company [CEO] Charles Ratner said the other day that after the lawsuits are all settled... he’ll still wait and see where he’s at. I thought that was a big change. How did you read that?

MM: Obviously you know that I am a tremendous supporter. I think we need Atlantic Yards more this year coming than we needed it at any time before. It will be a generator of jobs, both during the construction phase and post-construction. Many industries will feed off of Atlantic Yards. The volume of people visiting the area, retailers and other industries, will be enhanced.

Arena as corporate magnet?

MM: And having an arena and a national team is a great selling point to corporations that are looking to either relocate or to expand. You know as well as I do that basketball has become in many ways the sport of corporate — corporate sport, meaning that men and women that work for corporations eagerly look forward to going to games and people bring clients there. So having an arena and a national team would be an unbelievable incentive, in my opinion, a catalyst for jobs and new companies coming and staying in Brooklyn — my humble opinion!

That's the first time that argument's been made regarding Atlantic Yards, as far as I know. And the reason it hasn't been made is that it's bogus. (It hasn't exactly turned East Rutherford, NJ, into a corporate magnet, has it?)

Economist Arthur Rolnick, testifying before Congress earlier this year, said that Minnesota attracted several Fortune 500 companies not because of sports teams but because of investment in education.

Why, the Treasury Department's Eric Solomon was asked at the hearing, are cities bidding against each other for sports teams even though the city spending might be a bad investment? Solomon responded:
Because the cities believe that there are various benefits. Perhaps they cannot be specifically identified, but there are various intangible benefits. And they -- of course, there are political constraints on their decisions as well as financial constraints.

Creating jobs

MM: And the affordable housing that also would be a component of it — although it will take somewhat longer now — is still job number 1 1/2. Job 1 is creating jobs. Job 1 1/2 is creating affordabe housing so we can continue to live here.... We still significantly lack affordable housing.... So of course I’m not happy to hear what Mr. Ratner said in Cleveland. I know that it’s a tough time for everybody. But I’m hoping once the president firmly sets his policies and the banking industry starts churning out again and investments are beginning to be made, Atlantic Yards can get back on track and we can have the shovel in the ground in the not too far distant future. I can’t tell you when but I hope it would happen soon.

While construction would create jobs, as would retail and building services, keep in mind that the one promised office tower--which likely would house more relocated than new jobs--is on indefinite hold, and that the developer initially announced 10,000 office jobs.

Better process?

GK: Is there any part of you that or other people you talk to, [that says], “Maybe if this project had been done differently. A little smaller. Gone through a ULURP [city land-use review] process rather than a state process.” Are there any regrets on that level that this could have been done by now?

MM: I’m going to back to remind you, during the beginning, a lot of the people that expressed their opposition don’t want an arena. Because they don’t want the traffic. They don’t want the people. They don’t want it. And there’s the other group that don’t want the apartment buildings because they’re going to cast shadows. It’s too much. The bulk is too much. The density is too much. So I have to tell you, when it was first proposed, attempts were made by me and my office to reach out to the very best we can, but the immediate response was, “We’re not interested. Shove it! We don’t want it. How many times do we have to tell you, Mr. Markowitz, we don’t want it. We don’t the buildings. We don’t want the arena. We don’t want it.” And when you have folks that say absolute no, not, “Maybe we’ll take some housing, six stories high, eight stories high, y’know, that was OK, but we don’t want the arena.” Obviously, I wanted it all. And I still feel that we need it sooner rather than later.
(Emphasis added)

When it was first proposed. The project started with Forest City Ratner's idea, not any public process regarding some valuable public land. Had there been an RFP, multiple projects might have been proposed; ULURP would have provided a framework for a rezoning. In this case, the state, at the behest of the city and the developer, would override city zoning.

Is Markowitz suggesting that public input could've created a smaller project? There was never room for negotiation; the size of Atlantic Yards has always been decided by the developer. When the project was publicly announced in December 2003, Markowitz told Brian Lehrer that there had not been any place for public input in the design:
To involve the community and get them involved initially, in the planning, when it was far from anywhere completed… I have a pledge, that I’ve made to the residents of that neighborhood, as well as to Bruce Ratner, that is, that my office, me personally, will be coordinating the efforts, through a task force with our community to make sure that their concerns to the fullest degree possible are resolved.

To the fullest degree possible. Not even Markowitz's own concerns on traffic and parking have been resolved, at least at last report.

Yes, some people just wanted row houses, but project opponents and critics quickly created the low- and mid-rise UNITY plan in 2004; developer Extell drew on the principles for its 2005 bid for the Vanderbilt Yard, and a revised UNITY plan, featuring some high-rises, emerged in 2007. All would be more dense than Markowitz's "six stories high" formulation.

Issues of density

GK: But the density is an issue. You make it sound like — this would be the densest Census tract in the country.

Not quite, because it wouldn't be its own census tract, but it would be more dense than the densest, according to the New York Observer.

MM: You know what? There are those that would disagree with you on that. I don’t have my statistics here.

You'd think he'd have checked the statistics by now.

Maximizing affordable housing

MM: But what I can say is that one of the guiding principles of Atlantic Yards was to maximize the units of affordable housing. If the opponents--if the community--was willing to say — I don’t want them to say — if they said, “You know what, forget about the affordable housing, scratch it all, make it all market rents or market coop price, or condo,” there is no doubt in my mind that the bulkiness would have been significantly less. But it was our demands, and you can blame me indirectly and others, that, absolutely made, as a holy grail of Atlantic Yards, that there must be a maximum affordability of apartments. Maximum!

He's got it backwards. Affordable housing was used to justify the scale Forest CIty Ratner proposed (even if it's not required, according to the City Funding Agreement, to build at that scale, which would mean less housing and thus less affordable housing). Had affordable housing had been the goal, the government would've set the parameters.

Meanwhile, Markowitz, a former tenant advocate, has been pretty sloppy describing the affordable housing. Two years ago, he inaccurately described AY as containing “thousands of affordable units for people of very low income.” (Actually, it would include 900 units for people of low income, not very low income.)

"The jobs and the housing will go to those that need it the most," Markowitz said at a City Council hearing, suggesting $80,000 should be the household income cap. That number is well over six figures. He also never commented on the switch that assigned 450 apartments once aimed at moderate-income households instead to middle-income housholds.

MM: Listen, if it was up to me, it would be 75 percent affordable. We got that pledge, we got that promise, and that was one of the guiding principles of Atlantic Yards. And we’ll see what the future brings. I am confident that it is going to happen. I really am. I really am. I was hoping it would have happened in 2006, 2007, 2008, 2009, so if it’s 2011, it’s 2011, as long as I know it’s on track, and I hope it is.

It it was up to him, he should be trying to analyze the tradeoffs between density and affordability, and where subsidies get the best bang per buck. I don't have any proof that other affordable housing organizations could build two or three times as many units for the same money (as NoLandGrab says, as has DDDB), but the cost-benefit analysis remains worth pursuing.

Train at the station?

GK: Is it on track?

MM: I hear that. I understand that. It’s sort of--the train is at the station. It’s moving very slowly.

It's an interesting metaphor, given that a temporary railyard at Vanderbilt Yard has yet to be constructed and is well behind schedule.

MM: And we have to see what the future brings. Listen, Forest City Ratner can’t do it if it’s not there. It’s very, very simple. So let’s see what the next six months, a year, bring us. We need the jobs, we need the economic activity. I do know that the beginning phase, just a few buildings, as you know, and the arena, then, y’know, it would be over the course of 16--12 to 16 years, for a full workout of Atlantic Yards.

In essence, Markowitz is recognizing the truth of Forest City Enterprises CEO Chuck Ratner's March 2007 acknowledgment--quickly but dubiously clarified--that the project would take 15 years to build.

Enter BrooklynSpeaks?

MM: And I know that, as you go down the line and you begin the first phase, y’know, the community is much more involved, I must tell you, in a systematic way. And I would not be surprised that Forest City Ratner, as they move ahead on it, would be... There’s now--Gib Veconi, I happen to like and respect very, very much, what is that [group], Brooklyn Voices?

GK: BrooklynSpeaks.

MM: BrooklynSpeaks. Listen, they’re not crazy about Atlantic Yards, for sure. But they’ve got some valid, viable ideas, they’re reasonable people, they are. You don’t know, as things go ahead and as plans adjust and amend, whatever, as they move forward, that here and there, you tweak it here, you tweak it there.

BrooklynSpeaks, among other things, suggests that the project "be substantially reduced," that Pacific Street (except under the arena) and Fifth Avenue be left open, that new streets be created to connect surrounding neighborhoods, and that existing buildings "such as the historic Ward Bakery" should be reused. (That last one is a little too late.)

Does Markowitz think those are reasonable?

BrooklynSpeaks hasn't posted anything new since June.

Still confident

GK: You really tweak it, we hear that Gehry’s fired--

MM: I read that. It seems to me that Forest City Ratner has done what they could at this. What more should they do right now when the future seems to be somewhat unsure? So, I’m assuming that, once the green light’s there, the rest of this could be done in a relatively reasonable amount of time. We’ve waited this long already, so it’ll be a little longer. I’m confident it’s going to happen.

What more should they do? Well, at least admit that work is stalled because of economics, not because of litigation. Actually, they pretty much did.

Following up on Morningstar's claim that Forest City Enterprises stock would be worthless

When Morningstar recently said that Forest City Enterprises stock was likely worthless, it took several days--even after it was picked up by the Washington Post--for FCE to respond forcefully, plausibly stressing that the consensus of other financial analysts was that the stock should be a buy.

Since then, there's been some interesting criticism from an anonymous financial analyst commenting on Cleveland journalist Jill Miller Zimon's blog Writes Like She Talks.

Among the comments about analyst Matthew Coffina, who graduated Oberlin College in 2007 with an award in economics and is a Level 3 Chartered Financial Analyst candidate:
The kid, and I emphasize kid who wrote this article has very little experience as a securities analyst... and operates as a generalist i.e., he has no particular expertiese in the real estate industry....

FCE/A has said that Morningstar never contacted them. No analyst puts out work w/out talking to company, because quality of management is always a key factor... The point is i’ve been a securities analyst for 15 years and studied FCE/A and it’s tough for me to get my head around the b/sheet. I think the level of analysis done was superficial, and there’s no way that guy has the industry experties to make that opinion. Now, the outcome may make him look brilliant (we are in severe recession) but I mean seriously there’s no analysis there.

[quoting] "during the next three years, Forest City could face severe financial distress, since it may need to refinance debt at ever-increasing interest rates while operating cash flow declines.”

How is this different than any other REIT? Did the analyst notice that the rates FCE/A has been getting on refinancing have actually gone DOWN.

As I suggested, maybe the Morningstar analysts and the others cited by Forest City can (intellectually) duke it out.

Hamhanded response?

Miller Zimon scoffed at the commenter's suggestion that the analyst's dis went under Forest City's radar:
I completely disagree that FCE didn’t know about Morningstar. Please. If they aren’t following what entities like that write or say about them, even at the most basic level through clipping or some other mechanism, then maybe they deserve whatever happens as a result of the publication of such information. This is the news age where people can find anything as much as say anything.

Morningstar's report was actually out for a couple of weeks before it was picked up by the Washington Post.

Monday, December 29, 2008

Does marketing trump basketball when it comes to the Nets starting Yi?

Some New Jersey Nets fans have become harsh critics of Chinese forward Yi Jianlian, whose performance has been inconsistent; a few even suggest marketing considerations trump basketball judgments.

Commented a fan self-described as JohnY (who's Chinese-American himself) on NetsDaily:
Yes, we are being forced to start Yi, by Ratner & co who thinks Yi is marketing the Nets to 200 million fans. right…

Guess which NYC developer bought the proverbial Brooklyn bridge from the Chinese?

Another commenter observed:
Yi hasn’t played to expectations nor will he. He is just there for marketing values get rid of him he’s not helping us; he is holding the team back.

Mixed incentives

Those assertions are tough to prove, of course, and Nets' basketball brass may be right in thinking Yi will be a success, even though, as fans point out, he doesn't get much fourth-quarter playing time these days.

Upon trading the established Richard Jefferson for Yi (and Bobby Simmons and cap space), principal owner Bruce Ratner said in July, that “It’s 100 percent about basketball” and “The fact that along with a great player like Yi comes marketing opportunities is a wonderful thing, but it’s secondary to basketball. "

Even though Yi has not yet been "great," there's another incentive to make sure he gets playing time. CEO Brett Yormark signed sponsorship deals in September with four Chinese companies.

The Nets just announced a marketing deal with PEAK, a Chinese sportswear company, and are broadcasting 31 games in China. (I'm not sure if PEAK represents a fifth deal or the announcement of one of the deals signed in September.)

All-Star Game voting

Fan sentiment from China has even distorted the balloting for the All-Star Game (ASG), with Yi occupying third place among Eastern Conference forward in overall fan voting, ahead of stars like Chris Bosh and Paul Pierce, among others.

One commenter on a Nets message board has a sig file (right) that suggests an effort to vote for Yi over Boston Celtics superstar Kevin Garnett, who's on track to be a starter, would make the ASG "more of a joke."

He explained:
I'm a Yi fan, but obviously he has a lot of flaws in his game. Can't take Yi too serious or it'll piss me off.

The fan vote determines only the starters; the coaches choose the rest of the team. My bet is that Yi won't be chosen, though at least one of the more deserving Nets guards, Devin Harris and Vince Carter, will make the team.

The Yi deal

In a 6/29/08 NetsDaily piece, NetIncome (aka Bobbo) sketched the team's grand ambitions:
Richard Jefferson wasn’t traded for a player or two. He was traded for a country… China.

It’s not that the two ideas are mutually exclusive, but Yi, if handled right, presents the Nets with a golden opportunity....

New York has the biggest Chinese population in the United States—and Chinatown is one subway stop away from the site of the Barclays Center. The United States in turn has the largest overseas Chinese population in the world....

There is money to be made here… and not just in ticket sales, but in corporate suite sales, sponsorships and naming rights, lots of it. And not just by the franchise, but by the players. Nets’ games will now be featured on the fifty-plus Chinese TV stations that carry NBA games. There are 300 million Chinese who play basketball and one billion viewers watch NBA games on Chinese television. Some months, the NBA brings in more revenue from China than it does from North America. The numbers are staggering.

Of course he acknowledged the challenge:
Of course, Yi has to prove he can be a major contributor to the Nets. If he becomes a mediocre, deep shooting softie, not much of this will matter. He MUST become a star, he MUST become the next Dirk Nowitzki. The Nets ownership will demand it. The Chinese Basketball Association will too. Good Luck with that, Kiki.

Indeed, the jury's still out.

Sunday, December 28, 2008

Funny story: Yormark, in Star-Ledger profile, misremembers (or lies about) our encounter

A profile in the Newark Star-Ledger of New Jersey Nets CEO Brett Yormark, headlined Nets executive promotes New Jersey while selling Brooklyn, begins with the subject asserting he’s never read about P.T. Barnum, “the first great salesman/cajoler/marketer in American history.” Maybe that's a subtle sign that we should take what he says with a grain of salt.

The article, while offering much praise for Yormark’s hard work, salesmanship, and innovations, also addresses the challenges presented in the headline.

It also contains some very contradictory quotes from Yormark and me about who said what during a tour of Brooklyn I gave him before he was hired by the Nets.

From the article, it may seem impossible to arbitrate who’s right, but, as I contend (with backup evidence) below, in some places Yormark is either misremembering or simply not telling the truth.

(He hasn't been so good at predicting when the arena would open, has he?)

Watchdogging AY

I’ll reprint the section about hurdles facing the Brooklyn project and interpolate clarification and commentary. The article states:
Meanwhile, you can define Barclays only one way: inert. Some people -- many of the living around Flatbush and Atlantic Avenues -- like it that way. Organizations have been formed to fight it. Publications such as New York Magazine are increasingly skeptical. And then there are bloggers, such as watchdog journalist Norman Oder.

The censures and quibbles Oder has with the Atlantic Yards plan can fill a book, or at least his website ( Generally, and methodically, he has taken every word that Yormark and Ratner have uttered in the past four years and scraped it with a rusty razor.

Some of his objections are big things, such as their credibility about groundbreaking dates and the dubious impact on traffic, the school system and the environment. And some are little things, such as the price of a hot dog at Izod Center and the claim that Yormark starts every work day by rising at 4 a.m.

(For the record, Yormark suggested in a recent Fox Business News interview that a hot dog can be purchased for $1; Oder went to the arena last week and couldn't find one for less than $4.25. And for the record, Nets employees who work at the team's practice facility say it is not uncommon to see Yormark in the weight room by 5 a.m.)

For the record, when asked how attendance could be made more affordable, Yormark replied by speaking about the NBA in general: "There are opportunities to go to the concession stand and buy a hot dog for a dollar now."

I don’t doubt Yormark often gets up early. But I pointed out that Yormark refused to confirm, when asked, that he rises every day at 3:30 a.m.

(Indeed, if he's working 18 hours a day, as suggested in the article, he can't get up at 3:30 a.m. after a Nets home game that ends after 9:30 p.m. This really isn't a big deal--he obviously works hard--but it does indicate the potential for mythmaking.)


The article continues:
Regardless, "Atlantic Yards is, quite simply, the result of a bad process. Add to that a pervasive air of manipulation and dishonesty," Oder said in an interview conducted by e-mail. "Yormark is obviously an effective salesman. Unfortunately, he's too often not a credible one."

If the economy is the sisyphusian boulder threatening to crush Yormark's dream, Oder is the pebble in his shoe.

Of course, the blogger makes some valid points, at least with regard to obfuscation. For example, the official website for Atlantic Yards claims the project would create 15,000 construction jobs, but that is measured in "job years" -- meaning, 1,500 jobs a year for a decade, which is how long it will take to put up its 16 buildings.

Remarkably, Oder concedes that the political might is too strong to stop the project from going forward, but he'll write every day until the first shovel pierces the ground.

I didn’t make that concession in the email interview. I have said that, despite the troubles facing the project, I think it’s more likely than not that the developer and state will win the lawsuits and move forward. That chance of that happening has declined, but it’s still over 50%.

"Eats me up every day"?

The article continues:
"He's a nuisance," Yormark said. "Eats me up every day on his blog. And he's the guy responsible for me having this job -- totally sold me on Brooklyn, totally sold me on the Ratner project."

Every day?

Recently, I’ve mentioned Yormark quite often--20 posts since November 6, which is less than once every two days--because I’ve been writing about the Nets a lot. But I mentioned him in only 16 posts in the rest of 2008. That averages out to three times a month.

In 2007, I mentioned him in eight posts. In 2006, I mentioned him in three posts. In 2005, when I was blogging for just four months, I mentioned him once.

Funny story

The article continues:
Oh, funny story there.

In September 2004, Yormark -- like most guys from Jersey -- had enough knowledge of Brooklyn to fill a thimble. But to impress Ratner, he hired a tour guide for a fairly large sum, and became "Brooklynized" (his word) in just one day. The owner was blown away with Yormark's expertise of the borough and hired him after two interviews.

That tour guide's name? Norman Oder.

Oh, come now.

I have a tour guide business, and I was contacted by Yormark’s assistant to help familiarize Yormark with Brooklyn. It was before Yormark was hired in January 2005--the fall of 2004, I believe--well before I became immersed in Atlantic Yards. He didn't need to be sold on Atlantic Yards; rather, he needed to be able to show his potential employer he'd made an effort to learn something about the borough.

A fairly large sum? That’s the reporter’s efforts to square diametrically opposed recollections. He told me Yormark recalled paying me “around $1,000” for “9-10 hours.” I said I charged $100 (or maybe $120) for a tour that lasted less than two hours. (I do remember that he tipped me $50.)

I don’t charge $100 an hour for tours and, as my clients can attest, I offer step-down discounts after two and four hours. (Here are cost guidelines from the Guides Association of NYC, of which I’m a member.) Most of my tours last 2.5-3 hours. I’ve never done a tour longer than five hours or so--too tiring for me and for the client.

We spent less than two hours. Yormark was in such a hurry that we never got out of his SUV. We spent a good segment parked, talking. We never got out of the neighborhoods close to the AY footprint. We never set foot in Prospect Park, despite my urging that he get a sense of the landscape. Never got food. Never took a bathroom break.

If we’d had nine or ten hours, we could’ve gone to South Jersey and back. Could’ve walked Flatbush Avenue stem to stern, with time to spare. It just didn’t happen like he said.

As for becoming “Brooklynized,” as I said, Yormark wanted to be able to show his potential boss that he’d made an effort to understand the borough.

He did make an effort, but not a huge one. He kept trying to truncate the tour due to time pressure; he kept saying he was the boss as the client--hence my comment below calling him a "personable, master-of-the-universe" figure--while I was trying to convince him to gain more value from my expertise.

Great enthusiasm

The article continues:
Yormark insists that his guide-turned-nemesis spoke with "great enthusiasm" about the project during that fateful tour, but Oder's recollection is different.

"I did not speak effusively. I said there were very mixed opinions in Brooklyn," Oder said. "And I was barely familiar with Develop Don't Destroy Brooklyn, the main opposition group."

All Yormark knows is this: "He's the best tour guide money can buy," he said incredulously. "He helped me get my job, now he spends his entire life discrediting the project."

Well, I did wish Yormark well, as was appropriate for a client. While I appreciate his hyperbolic praise of my tour guiding abilities, I’ll happily concede that I look up to Francis Morrone.

Some back story

The article concludes:
Oder doesn't find this particularly ironic -- indeed, he has yet to write about the day he spent walking the streets of Flatbush with this "personable, master-of-the-universe" figure he now attacks daily.

Yormark has no time for irony, either, so he more or less considers their brief time together a Faustian bargain, or just the price of doing business. Two things P.T. Barnum would undoubtedly appreciate.

Well, we never walked anywhere. And it was just a couple of hours, not a day.

I hadn’t written about it because I was not acting as a journalist, so I didn’t feel it was my place to do so. But Yormark brought it up, so let me flesh out the story.

When we drove around the AY footprint and environs, I pointed out occasional signs opposing the project. Yormark, not inaccurately, observed that they were relatively few. I cautioned that the level of concern was likely greater than indicated.

Atlantic Yards, he told me more than once with great conviction, was going to happen; Bruce Ratner had assured him.

I didn’t know at that point what public process was to ensue--an environmental review by the Empire State Development Corporation, which began more than a year later--but that level of certainty, the kind of certainty that Yormark regularly peddles, stuck in my craw.

It still does.

Arena attendance

The article, early on, sketches Yormark's challenges with the Izod Center:
But you can sell only so much in an antiquated arena, one typically filled at only 80 percent capacity, with only 28 suites. That leaves one option: Yormark is moving the game.

I think "filled at only 80 percent capacity" is a stretch. The Nets are averaging 15,290, or 76.6%, in an arena that seats 19,968.

Plus, as I’ve contended, the Nets (and other NBA teams) report tickets distributed, not gate count, which means that the percentage “filled” is lower than reported attendance.

Saturday, December 27, 2008

With $5B in NYC development on hold or dead, could union accord with contractors jump-start projects?

Today the New York Times tells us that, according to the Urban Land Institute (ULI), nearly $5 billion in development projects in New York City have been delayed or canceled--meaning a virtually unchanged landscape for two years.

“There’s no way to finance a project,” the ULI's Stephen R. Blank told the newspaper. (Forest City Enterprises, btw, is active in the ULI.)

That suggests that Forest City Ratner's plan to get an arena started in 2009--or even 2010--is a long shot.

Union/contractor accord?

On Tuesday, Crain's New York Business broke the news, in an article headlined Construction unions may finance building projects:
Ed Malloy, President of the Building and Construction Trades Council, says the unions may put $100 million of pension fund money into a fund that would fund various construction projects. However, he said the unions would seek matching funds from the city and the state to create a fund of $300 million. A proposal will be sent to government officials next year.

“As the days go on you hear about more projects with financial problems and we really want to do something to help,” said Mr. Malloy.

The unions are already negotiating with contractors in an effort to lower labor costs by up to 25%. Louis Coletti, chief executive of the Building Trades Employers’ Association, which represents contractors, estimated that labor accounts for 50% to 60% of a construction job’s cost. Union workers earn an average of $60 to $70 hour.

If the cost of construction goes down--through productivity increases and wage frezes, rather than lowered wages--banks might be more eager to lend.

On Brian Lehrer

Interviewed on WNYC's Brian Lehrer Show on Wednesday, Malloy and Coletti were optimistic when asked to predict the situation with construction jobs in a year.

Coletti said, "There's two scenarios. If we're unable to reach an agreement, I think this could be the deepest recession bordering on depression that we've ever seen in this industry. With an agreement, I think that we can minimize the unemployment. We have to keep in mind, what Ed said before, is we're coming off the best five years that this industry has ever seen."

Malloy was unequivocal: "Recovery under way."

Neither discussed Atlantic Yards specifically; it's likely that even a $300 million fund would be parceled out to many projects. But the labor concessions would benefit many more projects, including AY, lowering the overall cost and speeding the construction timetable.

In other words, if the money were available--and that's hardly a given--maybe the arena could be built in less than 32 months.

Ex-commercial banker: Don't bail out America's "credit-drunk" commercial landlords and real-estate bankers

An expert on commercial property lending, in a letter published in yesterday's Wall Street Journal, suggests that commercial-property developers should be ashamed at asking for a federal bailout. Mike Offitt wrote, in part:
Unlike residential borrowers, most commercial landlords don't live in their buildings, and unless they are pleading stupidity, they understood perfectly, as did the lenders themselves, that the loans they were seeking from overeager conduit and securitization lenders were too generous. They decided to roll the dice and got rich with these cheap and easy funds. Now they are asking their formerly rich Uncle Sam to bail them out as their loans come due.

As the founder and former head of Deutsche Bank's commercial lending unit, and former senior trader of CMBS and commercial loans for Goldman, I am well aware of the perils of letting commercial-property borrowers fail: Either their lenders will have to extend them new terms, or they will face bankruptcies and tax recapture issues. Their bankers or securities holders will have to take losses and new investors will get to buy their holdings at deep discounts. Any other solution would be a travesty. The only thing more startling about the suggestion that the Treasury bail out the likes of William Rudin, Stephen Ross and Steven Roth is that they had the nerve to raise it. Washington should focus on making REMIC and securitization laws more flexible to allow extensions of loans or collateral substitution, not giving America's credit-drunk landlords and real-estate bankers a mulligan on the taxpayer dime.

More on Offit.

Did Gehry lay off staff working on AY or just move (most of) them?

Did architect Frank Gehry lay off two dozen staffers working on Atlantic Yards, as reported by the Wall Street Journal and the Daily News?

A commenter on the Brooklyn Paper's web site had a slightly different take:
El Sonrisas from Los Angeles says:
The layoffs were not exclusively of the team, most people from the Brooklyn team remain working for Gehry Partners. The layoffs were across all projects and all ranks. Most people from the Brooklyn project, whom still work at Gehry's, were simply relocated to other projects.

If that's true, it would be much easier for Gehry to reconstitute the team should the project get back on track (and he gets paid).

Friday, December 26, 2008

WNYC's Schuerman on AY timetable oversight: "the deadlines are pretty generous"

On Wednesday, December 24, WNYC radio's economic development reporter, Matthew Schuerman, was interviewed about Atlantic Yards at approximately 25:45 of Hour 2 of Morning Edition. While there wasn't much new for Atlantic Yards watchers, it was a decent summary of the issues and a reminder of the developer's over-optimistic plans, the government's limited leverage, and the question mark over the project's future.

The segment began with a quote from developer Bruce Ratner, who's rarely available to the media but appeared on WNYC's Brian Lehrer show in December 2003: "It will us take a year to go through the different processes and plans for the arena. And in about three to three and a half years, I hope to have an arena up and the start of some residential development."

That not-so-credible Arena 2006 plan has been pushed back again and again; when the project was approved in December 2006, the opening date was projected to be 2009, but now it's 2011 (and I think that's doubtful).

Delays and work

The narrator said that developer Forest City Ratner "has said publicly it has done all it can do until two lawsuits... get resolved." While that's an accurate report of FCR's statements, it ignores the countervailing evidence.

Interviewed by Richard Hake, Schuerman said that FCR was "tearing down buildings on the terra firma portion of the project... where the housing was supposed to be built, 6400 apartments, a third affordable, a dozen or more high-rises, mid-rises, low-rises."

Just to be precise, the western segment of the project, the arena block would also support the arena, not just housing, and the 16 towers all would be high-rise, at a minimum of 184 feet and now a maximum of 511 feet. (It's the UNITY plan that proposes towers of more varying heights.)

Schuerman also mentioned that the upfront investment in the arena would be $200 million; I'm not sure whether he meant the government investment--which is accurate, regarding the arena block--or some other figure.

Litigation and timetable

Hake asked how easy it would be for the developer to restart the project even if they win the pending lawsuits. (The defendant is actually the Empire State Development Corporation.) I think that the eminent domain case is a longshot for the plaintiffs, given the rules in New York State; while the case regarding the environmental review is somewhat more up in the air, I've said that the state and the developer have to be considered favorites to prevail.

Schuerman noted that, if they win, FCR said they will have to evaluate the bond market again. He cited an interview with Assemblyman Hakeem Jeffries, who along with other elected officials attended a meeting Monday with FCR and ESDC.

Jeffries told Schuerman that Forest City didn't make any promises about groundbreaking but aimed for some time in the fall, which meant, Schuerman said, "they'd be able to construct the arena in time to open it for 2011-2012 basketball season."

He added one caveat: "that's assuming the economy would be good enough."

I'll add another: while Nets CEO Brett Yormark and others have said the arena could be built in 24 months, the official construction schedule says 32 months and Bruce Ratner has said 30 months. In other words, the best-case scenario is likely 2012--unless a speed-up in construction work is possible.

Government leverage

Hake asked what the government was doing to make sure the project doesn't collapse.

Schuerman suggested that the city and state had some leverage in terms of delivering pledged funds.

He added: "There are some ways where they can get some of that money back if Forest City Ratner doesn't meet deadlines, but I gotta tell you, the deadlines are pretty generous. I think the arena has to built within six years of the settlement of litigation, for example, and in the entire project, there isn't really a deadline Forest City has to meet. So for the most part, the city and the state are just crossing their fingers, waiting to see. It's a little too early to say that this project is doomed, exactly, and there's hope that the economy will turn around quickly."
(Emphasis added)

The generous deadlines and limited penalties imposed by the State Funding Agreement and City Funding Agreement, signed in September 2007--nine months after a ten-year buildout was anticipated in the project approval, and well before the market crash--deserve a lot more attention.


Hake asked if AY opponents are jumping for joy.

Schuerman responded: "I'm sure there's some schadenfreude there, to see Forest City Ratner on the rocks like this, struggling to get this project under way, really. But they live here--it's a devastated neighborhood, it's even more devastated now that half, three-quarters of the buildings are cleared away, and they're really worried that Forest City Ratner will sit on this land, not doing anything for five, ten years, and their neighborhood will just get worse and worse."

I think that, while perhaps half of the buildings have been demolished, many larger buildings remain, so less than half of the non-railyard site has been cleared.

People in and bordering the footprint are living near empty lots--blight as defined by the state. Most of the opponents live outside the footprint and have a more peripheral relationship to the site--forced by the closure of the Carlton Avenue bridge to detour, or to pass some eyesores--but an ongoing relationship to the policy response, or lack thereof.

"Long stratagem and sports kingdom"? With Yi on board, Nets sign marketing deal with Chinese sportswear company

The New Jersey Nets are having Office Max help sponsor the holidays, in case you didn't notice. And forward, Yi Jianlian, of China, may be having an up-and-down season, but he wasn't named the NBA's ninth-most marketable player for nothing.

According to People's Daily, which apparently scooped the domestic press:
The Nets have entered into a multi-year sponsorship alliance with PEAK, a China-based company specializing in sports apparel production, including shoes, sportswear, and gear.

The announcement of the sponsorship was made at a press conference on Monday at the High Point Solutions Business Center at the IZOD CENTER, which was attended by PEAK general manager and executive director Xu Zhihua and Nets chief executive officer Brett Yormark. The press conference also included a performance by the Peking Opera and a fashion show, with PEAK models taking the ramp.

PEAK's sponsorship agreement with the Nets includes television visible courtside and baseline signage that can be seen during the 31 Nets' regular home games this season that will be broadcast in China. PEAK, which is based in Quanzhou, Fujian province, was founded in 1989.

At right, a PEAK official with Nets CEO Brett Yormark.

PEAK performance

PEAK has also signed seven NBA players to endorsements, one of them former Net Jason Kidd.

The press release could use a little editing, given that a PEAK spokesman was quoted as saying, "We will enhance the cooperation in the NBA market, and present the quality sports gears to more NBA players and the fans around the world.”

Reuters earlier this year wrote about the growth of Chinese companies producing sportswear.

Poaching from Milwaukee?

When the Nets traded for Yi last July, Bruce Ratner said, “The fact that along with a great player like Yi comes marketing opportunities is a wonderful thing, but it’s secondary to basketball."

Indeed, sports entertainment is an international business, not one about Brooklyn pride, as DDDB would remind us.

Last year, PEAK signed a deal with the Milwaukee Bucks, where Yi used to play. While the Bucks announced a multi-year deal, it's unclear how much was tied to Yi's presence. I suspect the new deal with the Nets takes precedence, given that the only other team with which PEAK has a contract is the Houston Rockets, with the Chinese center Yao Ming. Then again, the Bucks did play in China during the preseason.

I'll assume that the Nets will work with PEAK so that the company's press release will be a bit more polished than the one last year:
19th, Dec. 2007. PEAK partner with MILWAUKEE BUCKS of NBA.become the first one partner with BUCKS of NBA in china.PEAK will cooperate with MILWAUKEE BUCKS for long stratagem and sports kingdom.

Bad translations from Chinese to English have been such a feature of life in China that the government made a special effort to correct signage in the run-up to the Olympic Games, according to the Wall Street Journal.

Forest City Enterprises "astonished and appalled" at Morningstar for calling stock worthless

A Cleveland Plain Dealer blog entry headlined Forest City fights back reported that Forest City Enterprises Inc. called Morningstar's analysis that the stock is worthless "was based on flawed assumptions and inaccurate interpretations of the company's debt obligations and its construction costs."

The Plain Dealer reported:
"We disagree in the strongest possible terms with Morningstar's opinion," spokesman Jeff Linton wrote in a statement. "Further, we are astonished and appalled that Morningstar would issue such an opinion without having made contact with Forest City."

Linton said no Morningstar representative has contacted or spoken to any senior-level executive at Forest City in two years... Five analysts who regularly cover Forest City have taken a neutral stance on the stock or expect it to perform slightly better than the market.

"We remain stable, with good liquidity and solid cash flow from our operations, and we have implemented a strategy to specifically address current market conditions," Linton said.

Debate pending

I don't know whether Morningstar typically contacts senior-level executives before issuing such a dramatic assessment, but Forest City's grievance seems reasonable. (If only they would reciprocally answer questions from the press themselves. Updated: DDDB points to flawed assumptions and inaccurate interpretations re AY.)

The analysts who are neutral or slightly positive on the stock should count for something--indeed, the consensus among five analysts tracked by Yahoo is 2 on a scale of 1 (Buy) to 5 (Sell), with two at Strong Buy, one at Buy, and two at Hold. The analysts haven't exactly distinguished themselves by publicly asking hard questions of the company. But I think neither they nor Morningstar based their reports on a close look at Atlantic Yards.

Maybe they and the Morningstar analyst could put their cards on the table and have a debate.

Via Ticketmaster, Nets tickets are free (with service charge)

Well, if attendance in the NBA is about tickets distributed, then gate count is about getting fans in the seats to buy concessions, not what they paid to get there, right?

So the Nets are giving tickets away. An announcement on Ticketmaster:
As part of the Nets Tickets on Us Program, you are receiving this one time, complimentary* ticket offer to see the Nets take on some of the NBA's best at the IZOD Center. Simply select one of the home games listed below and you can receive up to two tickets to the game. It's about taking a break and enjoying a night out, courtesy of the Nets.

Valid on tickets regularly priced at: $110 $80, $76, $40, $20, and $15.

Thursday, December 25, 2008

"New Improved Brooklyn" revisited more than 4.5 years later (with a hint about an architect helping Gehry)

Let's flash back to Alexandra Lange's 4/26/04 article in New York Magazine, headlined New Improved Brooklyn, subtitled "A glittering skyline, waterfront condos, new jobs, Frank Gehry buildings galore: Brooklyn is on the verge of a makeover even more extreme than you thought, re-creating itself in Manhattan’s image. What’s wrong with this picture?"

It's a fascinating look back, given the promises unfulfilled, and it even contains a hint that Forest City Ratner, despite public orders to the contrary, once planned to have Hugh Hardy, the architect of the developer's Atlantic Terminal mall and Court Street cinema complex, collaborate with Frank Gehry on Atlantic Yards.

The big rezonings

Lange wrote about Department of City Planning director Amanda Burden's plans to rezone Downtown Brooklyn and the Williamburg-Greenpoint waterfront:
Burden’s plans, enabled by two lengthy rezoning proposals, could add more than fifteen new towers, 4.5 million square feet of office space, and 8,500 new housing units. The city’s plans would have been enough to herald a major conceptual shift, but then, in October, developer Bruce Ratner of Forest City Ratner announced that he had hired Frank Gehry to design an arena for what will become the Brooklyn Nets over the MTA rail yards at Flatbush and Atlantic avenues. The less-examined portion of Ratner’s plan for the Atlantic rail yards adds residential towers for 4,500 people between Fort Greene and Prospect Heights. Across the street, Ratner is rushing to complete the Atlantic Terminal, a mall that includes a Target in a big box below and 1,500 Bank of New York employees in a tower above.

Well, the mall got built, but the arena has gone through two more designs, and that roof garden would no longer be public (nor even green). (And, yes, the arena would not be "over the MTA rail yards," an error the New York Times made too often; if so, no eminent domain would have been needed.)

In the BAM cultural district

Lange wrote:
Two blocks away, the BAM Local Development Corporation has just announced a second Frank Gehry project: The Theatre for a New Audience will be housed, sometime circa 2007, in a building designed by Gehry and echt–New York architect Hugh Hardy. The theater will share a triangular site with a public Visual and Performing Arts Library designed by up-and-coming Mexican architect Enrique Norten.

Well, Gehry's been ousted from the theater project, and the library plan--for an impressive building whose cost way outstripped the library's fundraising ability--is history.

What is Brooklyn?

Lange tried to assess the stakes:
On one level, this is simply the mother of all NIMBY (not in my backyard) battles—since Gehry’s stadium and its accompanying towers will literally be built in some Brooklynites’ backyards. And Brooklyn’s potent, sometimes cloying nostalgia for the way things were—dese and dose, egg creams and spaldeens—can fuel a knee-jerk rage at any change at all. But now there’s another force at work. In the past five years, Brooklyn has reached a new maturity and self-confidence. Gehry is arriving at a moment when the borough is fashionable, even by Manhattan’s exacting standards. Who wants to live on the Upper West Side when you can live in Park Slope? Who needs the East Village when you can socialize on Smith Street? Ratner and Burden seem to want to raise the borough up, make Brooklyn take a quantum leap, create a new kind of city—one that more closely resembles Manhattan. Which seems wrongheaded to many current residents. The real topic here is, what is Brooklyn?

Indeed. While some arena opponents might be called (and still are) NIMBYs, the emergence and embrace of the UNITY plan should have pretty much put that to rest.

And the question "what is Brooklyn" might have been well put to Brooklyn Borough President Marty Markowitz, who cloyingly invokes the Brooklyn Dodgers when plumping for the arena, and who seemed lost in the desperate 1990s when, in 2003, he told Brooklynites they should be thankful for Forest City Ratner's Atlantic Yards investment, rather than driving a hard bargain for some very valuable land.

Downtown a place for jobs?

Lange cited the city's justification for rezoning Downtown Brooklyn:
But residents, the city says, are refusing to see the greater good; in the post-9/11 era, the boroughs need to play their part in what is delicately referred to as “business-continuity planning.”

“When you look across the Hudson River, you can see all the jobs that should have been in New York City,” says Amanda Burden. “Downtown Brooklyn has every advantage and is completely underzoned right now for development.”

By increasing the possible heights on several city blocks, and assembling large land parcels that include the lot on which Chatel’s house sits, City Planning hopes to create sites for four new towers, of 18 to 40 stories each. Its goals are to knit MetroTech, Ratner’s earlier, much reviled project, on Adams, to the bustling retail corridor along Fulton Mall, creating a tall, tight Downtown business district and to connect this new, improved Downtown to Boerum Hill and Cobble Hill.

Well, there are sites for many more than four towers. Most, however, contain (or will contain) market-rate housing, given that the market for office space tanked and the city, in its lack of foresight (and pressure from activists) refused to consider requiring affordable housing as a tradeoff for the increased density and value offered to developers.

Design issues

Lange pointed to Ratner's checkered record with design:
Frank Gehry’s arena is Bruce Ratner’s glittering gift to Brooklyn’s intelligentsia. Since Bilbao, Gehry has levitated out of the architecture ghetto to become an American aesthetic hero, a god with feet of titanium. “Having a Frank Gehry–designed arena in Downtown Brooklyn will put Brooklyn on the map globally,” says Burden. “We know how great Brooklyn is; now everyone will know how great it is.”

“Bringing in Frank Gehry to do everything, that’s huge,” says Bruce Bender, a Forest City Ratner executive vice-president, a born-and-bred Brooklynite, lately of Peter Vallone’s office, who lives in Park Slope. “He could have gotten away with picking another architect, but he wanted it to be very special.”

Of course, many of the neighbors see Gehry as window-dressing, a beautiful distraction, a Trojan horse for Ratner and his cookie-cutter condos and big-box stores. To say that Ratner is not a figure most would entrust with Brooklyn’s aesthetic future would be an understatement. MetroTech is inarguably bland and deserted after five and on the weekends. His Atlantic Center mall is worthy of a Mike Davis inner-city architecture rant.

“The biggest complaint about this,” Bender says, gesturing across Atlantic Avenue at the sunken rail yards, “is that they don’t want it to be that,” pointing to Ratner’s hated Atlantic Center—a tan box with sidewalk-side retail on no sides, zero interior amenities, and long, hot institutional hallways between the few popular stores: Pathmark, Old Navy, Party City. “Bruce is very focused on upgrading Atlantic Center to the standards of Atlantic Terminal.”

Atlantic Terminal is an improvement: It is brick, or, at least, brick-faced, and its squat office tower is self-effacing. The architect, Hugh Hardy of Hardy Holzman Pfeiffer, has even given the whole a ballpark entrance: a white, semi-circular pavilion that pops out toward the intersection of Flatbush and Fourth Avenue. Hardy is a classic choice, and will be collaborating with Gehry in the next block, but he is best known to Brooklyn as the designer of the borough’s second most reviled building, the rick-rack-sided twelve-plex on Court Street in Brooklyn Heights, a pile of misplaced giant Christmas gifts.

(Emphasis added)

It seems like Lange broke some news here, in retrospect, given that Gehry has said he'd typically bring in other architects but "the client insisted that I do them all."

Could it be that, given a ten-year (official) or 20- (acknowledged by project landscape architect Laurie Olin) or 30-year (more likely, if ever) buildout of the project, Gehry, who turns 80 next February 28, was never expected to design the whole project?

After all, Gehry in 2006 said, "The determining factor [in taking a commission] is: Can I get it done while I am still alive?"

Open space & a superblock

Lange suggests that the architects, not the developer, drove the superblock design:
It is this desire for groves and lawns, a true escape, that pushed the architects to ask for the closing of Pacific Street, and the creation of what looks very like a sixties superblock. Olin dismisses this criticism—“We’re not going to build thirties towers in a greensward. We’ve learned in the last 30 years about seeing and being seen”—a paraphrase of “eyes on the street,” one of urban theorist Jane Jacobs’s most valuable insights.

Well, undoubtedly they could build a better superblock, with buildings flush to the street as opposed to isolated in a park. But that still doesn't mean the public, as opposed to project residents, would use the open space much. (Streetsblog hosted some interesting comments, some supportive of Olin, given his track record.)

Olin, in a 2/25/07 interview with the New York Observer, said he was brought in well after the decision to demap the street was made; the Observer's Matthew Schuerman observed that the street bed was needed to marginally increase the already-low open space ratio in the area.

The market at work?

Lange wote:
The most contentious issue is the displacement, via eminent domain, of the 200 to 400 people who live and work on and between Pacific and Dean streets. Ratner says he has to condemn these blocks of brownstones, condominiums, and small businesses, because the arena won’t fit any other way. Bender says the market has been given enough time to repurpose the old bakeries, the mini storage centers.
(Emphasis added)

Well, the number at risk of displacement--most, ultimately, not via eminent domain but the threat thereof--was 463 residents (plus 400 in a homeless shelter) and 225 workers, according to a Village Voice report, using numbers from activist Patti Hagan. (Develop Don't Destroy Brooklyn, based on work by Hagan and others, prepared a March 2004 census that showed 334 residents--209 tenants, 125 owners--and 235 employees, plus the 400 people who regularly use the shelter, some for over a year.)

The second sentence in that paragraph is misleading. True, the arena wouldn't fit without condemning the south side of Pacific Street and north side of Dean Street between Fifth and Sixth avenues: Block 1127. But the portion of Block 1128, on Dean and Pacific streets just east of Sixth Avenue, is needed for Forest City Ratner's plans to stage arena construction. And Block 1129, bounded by Pacific and Dean streets and Carlton and Vanderbilt avenues, was chosen for interim surface parking and Forest City Ratner's plans to maximize square footage.

And the third sentence is simply a lie. The market wasn't given much time because the neighborhood wasn't rezoned. Repurposed industrial buildings like Atlantic Arts, Spalding, and Newswalk were the result of spot rezonings. The Ward Bakery could have been repurposed and, as reported, owner Shaya Boymelgreen (the Newswalk developer) once considered it for a hotel.

Forest City Ratner got the state to override zoning rather than let the market work. Here's the ESDC's head-in-the-sand take.

Community contact?

Lange wrote:
Gehry and his associates have already begun holding videoconferences with members of the affected community, and the design is evolving from the publicized model. “It’s a shifting plan because they have community meetings. They call and say, We’re going to leave this building and that building and What if this happens? and What if that happens? We do a lot of what ifs, and ands, and buts.”

Videoconferences with members of the affected community? I sure don't remember the invite. Gehry has notoriously not been permitted to meet with the public.

(Update: I'm told that one such invitation-only videoconference was held, at the request of community members; the developer was not receptive to the idea of moving the arena.)

Battery Park City?

Lange checked in with the project's leading political opponent:
Like the Downtown Plan’s rendering of Willoughby Street as a second Rockefeller Center, Ratner’s idea of residential towers—however elegant—seems airlifted in from the other bank. “It’s a Battery Park City,” says City Councilwoman Letitia James, who represents Fort Greene as a member of the Working Families Party. She, practically alone among the better-known Brooklyn politicians (Marty, Chuck), has vehemently opposed Ratner’s plan, speaking against the arena, against eminent-domain abuse, for affordable housing, for jobs for Brooklynites. The Atlantic Yards plan is largely out of the city’s hands, on state-owned land, funded by a private developer. But it could have as great an impact, and as many towers, as the Downtown Plan: home to the Brooklyn Nets, 2.1 million square feet of office space, 4,500 housing units, and 300,000 square feet of retail space. The tallest projected tower, at the intersection of Atlantic and Flatbush, would top out at 620 feet—108 feet higher than the Williamsburgh Savings Bank building.

The irony is that Battery Park City, while criticized for not fulfilling promises of affordable housing, has much-praised open space and a projected density, at full buildout, a little more than half that of Atlantic Yards, at least as approved.

Lange wrote:
But to many, particularly the architecturally savvy, BPC is an image of an evil to be avoided at all costs—antiseptic, overpriced, homogenous, all that is not Brooklyn.

Affordable housing

The article didn't press James to explore a contradiction:
Tucked into the back of a social-service agency, James’s district office doesn’t even have a view of the back side of the Atlantic Center, much less the parks on the future arena site. Her barred windows look across a set of bare backyards. No pictures on the walls. Not even a flower on the desk. “The No. 1 issue throughout the city of New York is the crisis in affordable housing,” says James. “There are these ten acres of land available, and I would like to provide for the needs of my constituents. I’d like to see an expansion of Atlantic Commons”—three-story rowhouses, inexpensively built, between South Oxford and Cumberland streets. “I’d like to build more townhouses, I’d like to build some more rental units and some more commercial and retail units. Something which is more in character with the community.”

Well, like many of us, James has learned a lot more about urban planning over the years. Atlantic Commons, while pleasant enough for its residents, is far less dense than the infrastructure could support.

Atlantic Yards, as approved, would supply a significant amount (2250 units) of subsidized housing, even if only about half of that would be accessible to the "real Brooklyn" and it might take a very long time to get there. The complication is, to get that number of units, the developer, signing a privately negotiated affordable housing bonus with the advocacy group ACORN, got to decide the density. And the total is by no means guaranteed.

Manhattan vs. Brooklyn

Lange found more subtlety when looking into plans for the BAM LDC:
“We talked about the difference between Manhattan and Brooklyn, looking between the two places to try to identify what is the Brooklyn thing,” says Charles Renfro, the Diller Scofidio + Renfro partner who was team leader for the firm’s BAM LDC master plan. “We researched how many artists lived there, and Brooklyn has way more artists than Manhattan. The reality about Brooklyn is that people are living there and doing their stuff and not screaming out for attention.”

...“The Fort Greene district lies at the crossroads of all these different forces—how do you make something interesting that’s not dictatorial?” Renfro says. “How do you make something that deals with the scale of the city while not being banal? How do you reinforce it but also make it more interesting? We made images which tried to evoke a spirit, an experience of the place, as opposed to a look.”

Open spaces, like the one Norten describes, were a part of that spirit, as was an attempt to remove as few buildings as possible. “It is certainly a contrast to the Atlantic Yards development, which is exactly the kind of thing we tried not to do—a wiping clean of the blocks, and a top-down megastructure placed in it,” Renfro says.

In conclusion

Despite her sympathy for grand plans like Gehry's, Lange was skeptical in her conclusion:
It shouldn’t take towers along the waterfront to recenter our mental maps of New York on the East River, not at Central Park. Brooklyn is already different, inextricably linked, but equal. It shouldn’t be back-office territory, but front-office space for smaller businesses. Those potential Williamsburg towers really are on the Fifth Avenue of the future. Enrique Norten’s library, Frank Gehry’s theater and arena are equivalent to Herzog & de Meuron’s South Bank Tate Modern—jewels in the setting that is Brooklyn, rather than alien presences.

The trick, then, for Brooklyn’s neighbors is to negotiate with the city, with the developers, with the architects, from a position of strength. Know neighborhood character, and admit its weaknesses. Point the Manhattan developers to real instances of blight. Look to the development that has been and is now already occurring, without benefit of tax breaks and zoning incentives.

The fear of Manhattanization is not, in this case, knee-jerk nimby-ism, but the sense that many chose to Brooklynize instead—to move here from other places, to stay here for multiple generations. What is attracting all this top-down money is work that has already been done by people happy to say, when asked at a party, No, I don’t live in New York. I live in Brooklyn.

(Emphasis added)

The trick was that Mayor Mike Bloomberg and his allies never tried to let the neighbors negotiate.

Whitehead: our own eminent domain

An accompanying essay is headlined Don't You Be My Neighbor, subtitled "Colson Whitehead laments the latest death of Brooklyn at the hands of developers— but says we all practice forms of eminent domain."

The novelist wrote:
I used to live in Fort Greene, and whenever I visit my old neighborhood, I am tormented by the same absurd thought: I should have bought that crack house when I had the chance. Never mind that I was broke—this line of thinking is a natural member of that gang of peculiar New York regrets.

AY resistance

He wrote about those resisting Atlantic Yards, reminding us of a cohort that doesn't get acknowledged:
For weeks now, signs have been visible in the windows of Pacific Street apartments, saying SAVE OUR HOMES and HELL NO WE WON’T GO. Apartment buildings and businesses will be demolished to make way for these grand plans, and it’s estimated that 200 to 400 people will be displaced, though this figure doesn’t include a shadow number—the people who would have lived in the neighborhood in its current incarnation but won’t be able to afford it. Half of them probably don’t even live in the city limits now, haven’t bought their tickets yet.

What about the sky?

Whitehead wrote not without irony:
It was impossible not to notice the sky that afternoon. You could see it, lots of it. There was simply too much sky there, and the city hates it when there’s too much sky. The space needs to be filled. The anti-development folks were so small compared with the empty railroad tracks. You had to ask, What is the power of people against the might of buildings? I wish them luck. The people, that is. The buildings don’t need it.

The next new thing is always ugly in proportion to its inevitability. Is it the death of Fort Greene? It’s the death of Fort Greene.

But the current Fort Greene was the death of the one before it. Eminent domain approaches in many guises. It comes in sledgehammers, bulldozers, pieces of paper that declare in legalese, “This building condemned.” Then there is eminent domain in its quieter, less bombastic forms: the arrival of the goateed and bohemian-minded, rent increases, the monied, the condoed....

Does displacement simply segue into eminent domain or is there a difference?

Beyond adaptation

He concluded:
In the end, the same energy that draws us here, binds us to this place, is alternately creative and destructive, razing here, renovating there, and it’s all we can do to adapt. I doubt that the well-heeled future inhabitants of those Pacific Street high-rises will be happy come game day, when the jerseyed hordes bubble out of the Atlantic Avenue station. The only people who are happy and without care are the little cartoon people who promenade across architectural plans, in the artist’s renderings of the Atlantic Yards, the new World Trade Center, the Olympic Village in Queens. Certainly their features betray no troubled thoughts as they stand before the fountains, stadiums, and tree-lined plazas. It helps that they have no faces.

He's a brilliant writer, but his acceptance of inevitability sounds somewhat akin to that of Danny Hoch in his recent one-man show about gentrification, "Taking Over." The alternative to acceptance is community engagement in planning.

While many might see that engagement as dull and demanding, keep in mind that New York City as of now structurally inequipped; the community boards, which service areas the size of small cities, generally have just one professional staffer.