Skip to main content

Orwellian, almost: mayor claims commitment from Ratner to build affordable housing in first tower, but it's really the other way around

I finally figured out why Crain's New York Business last month proclaimed as news that the first apartment tower in the Atlantic Yards project would consist of at least 50% subsidized, "affordable" units.

Because Mayor Mike Bloomberg said so.

And, at the time, I didn't notice how "Orwellian, almost" it was, given that the mayor claimed that he'd gotten a commitment from developer Forest City Ratner, while the real news was that the developer could only make a commitment if he was ensured scarce city subsidies.

(Forest City Ratner has long promised that the first tower would be 50% subsidized, as in this 5/5/08 press release, also embedded below.)

From the press release

On the occasion of the March 11 arena groundbreaking, the press release from the mayor's office deviated from the official press release (both embedded below), in part, by adding this:
In the first phase of development, which includes four buildings, Forest City Ratner Companies committed that at least 30 percent of the housing units would be income-targeted. Mayor Bloomberg also announced today that the City has secured an additional commitment from the developer to ensure that at least 50 percent of the units in the first residential building will be affordable to a mix of low-, moderate- and middle-income families.
(Emphases added)

An additional commitment from the developer?

Forest City Ratner won't build subsidized housing unless there are sufficient affordable housing subsidies; that's in the Development Agreement, which allows for eight renewable one-year delays in the absence of subsidies.

So the news was really that Bloomberg has implicitly made a commitment to subsidize that tower.

(Also note that the first phase of the project was supposed to include six buildings, not four, but an office tower on the arena block and another tower across the street at Site 5 have been put on hold.)

What kind of housing commitment?

The Development Agreement laid out multiple scenarios for the first tower (see graphic below); in five of six scenarios, the building could be completely subsidized, albeit with at least 60% of those units available to households at 150% or more of Area Median Income (AMI), or $115,218 for a four-person household.

While that's hardly rich by New York City standards, it certainly does not represent the constituency of ACORN, which signed the Affordable Housing Memorandum of Understanding and provided the people to cheerlead for it.


Note that in all three scenarios contemplated in the Housing Memorandum of Understanding (embedded below) ACORN and Forest City Ratner signed in 2005, 5% of the AY rental units, and thus 10% of the affordable units, would be for households with incomes between 30-40% of AMI.

Now, there would be fewer such units.

For the first building, that number has been reduced to 3% (and thus 6% of the affordable units) under Scenario 1 in the above chart, with 17% (rather than 15%) of the units in the next income band. from 40-50% of AMI.

While the switch may seem marginal, consider that the lowest-income units require the most subsidy. In a building of 350 units, as is contemplated in the first tower, that would be a reduction from 17.5 units (5%) to 10.5 units (3%), part of a total of 70 low-income units.

And none of the other scenarios contain any low-income units.

The advantage of the other scenarios

Why might it be advantageous for Forest City Ratner to build an all-affordable tower with no low-income units?

Because it's committed to building at least 30% of the units on the arena block as affordable. That means, for example, 450 out of 1500 apartments.

If 350 of those apartments are already spoken for in the first building, that would require the developer to build only 100 additional subsidized units.

More than 50% affordable?

But it's quite likely there would be many more subsidized units, given that rental buildings are contemplated under a 50% market-rate and 50% subsidized scenario and there's no reason, at least right now, for the developer to build speculative condos.

So Forest City Ratner might end up building Phase 1 with more subsidized units than it promised.

That wouldn't be a sacrifice; the scarce city subsidies guarantee profits. But it would allow the developer to claim that it had met even more than its commitment. And Bertha Lewis of ACORN would surely offer ritual praise.

However, would ACORN--scratch that, New York Communities for Change--members be served? Not many.

Mayor Mike Bloomberg Atlantic Yards Arena Groundbreaking Press Release

Barclays Center Groundbreaking Press Release

ACORN/Forest City Ratner Housing Memorandum of Understanding

Atlantic Yards: May 2008 Gehry Designs Press Release

Comments

Popular posts from this blog

Barclays Center/Levy Restaurants hit with suit charging discrimination on disability, race; supervisors said to use vicious slurs, pursue retaliation

The Daily News has an article today, Barclays Center hit with $5M suit claiming discrimination against disabled, while the New York Post headlined its article Barclays Center sued over taunting disabled employees.

While that's part of the lawsuit, more prominent are claims of racial discrimination and retaliation, with black employees claiming repeated abuse by white supervisors, preferential treatment toward Hispanic colleagues, and retaliation in response to complaints.

Two individual supervisors, for example, are charged with  referring to black employees as “black motherfucker,” “dumb black bitch,” “black monkey,” “piece of shit” and “nigger.”

Two have referred to an employee blind in one eye as “cyclops,” and “the one-eyed guy,” and an employee with a nose disorder as “the nose guy.”

There's been no official response yet though arena spokesman Barry Baum told the Daily News they, but take “allegations of this kind very seriously” and have "a zero tolerance policy for…

Behind the "empty railyards": 40 years of ATURA, Baruch's plan, and the city's diffidence

To supporters of Forest City Ratner's Atlantic Yards project, it's a long-awaited plan for long-overlooked land. "The Atlantic Yards area has been available for any developer in America for over 100 years,” declared Borough President Marty Markowitz at a 5/26/05 City Council hearing.

Charles Gargano, chairman of the Empire State Development Corporation, mused on 11/15/05 to WNYC's Brian Lehrer, “Isn’t it interesting that these railyards have sat for decades and decades and decades, and no one has done a thing about them.” Forest City Ratner spokesman Joe DePlasco, in a 12/19/04 New York Times article ("In a War of Words, One Has the Power to Wound") described the railyards as "an empty scar dividing the community."

But why exactly has the Metropolitan Transportation Authority’s Vanderbilt Yard never been developed? Do public officials have some responsibility?

At a hearing yesterday of the Brooklyn Borough Board Atlantic Yards Committee, Kate Suisma…

Barclays Center event June 11 to protest plans to expand Israeli draft; questions about logistics

At right is a photo of a poster spotted in Hasidic Williamsburg right. Clearly there's an event scheduled at the Barclays Center aimed at the Haredi Jewish community (strict Orthodox Jews who reject secular culture), but the lack of English text makes it cryptic.

The website Matzav.com explains, Protest Against Israeli Draft of Bnei Yeshiva Rescheduled for Barclays Center:
A large asifa to protest the drafting of bnei yeshiva in Eretz Yisroel into the Israeli army that had been set to take place this month will instead be held on Sunday, 17 Sivan/June 11, at the Barclays Center in Downtown Brooklyn, NY. So attendees at a big gathering will protest an apparent change of policy that will make it much more difficult for traditional Orthodox Jewish students--both Hasidic (who follow a rebbe) and non-Hasidic (who don't)--to get deferments from the draft. Comments on the Yeshiva World website explain some of the debate.

The logistical questions

What's unclear is how large the ev…

Atlanta's Atlantic Yards moves ahead

First mentioned in April, the Atlantic Yards project in Atlanta is moving ahead--and has the potential to nudge Atlantic Yards in Brooklyn further down in Google searches.

According to a 5/30/17 press release, Hines and Invesco Real Estate Announce T3 West Midtown and Atlantic Yards:
Hines, the international real estate firm, and Invesco Real Estate, a global real estate investment manager, today announced a joint venture on behalf of one of Invesco Real Estate’s institutional clients to develop two progressive office projects in Atlanta totalling 700,000 square feet. T3 West Midtown will be a 200,000-square-foot heavy timber office development and Atlantic Yards will consist of 500,000 square feet of progressive office space in two buildings. Both projects are located on sites within Atlantic Station in the flourishing Midtown submarket.
Hines will work with Hartshorne Plunkard Architecture (HPA) as the design architect for both T3 West Midtown and Atlantic Yards. DLR Group will be t…

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

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

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

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

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

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

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

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

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

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

But official…

So, Forest City has some property subject to the future Gowanus rezoning

Writing yesterday, MAP: Who Owns All the Property Along the Gowanus Canal, DNAinfo's Leslie Albrecht lays out the positioning of various real estate players along the Gowanus Canal, a Superfund site:
As the city considers whether to rezone Gowanus and, perhaps, morph the gritty low-rise industrial area into a hot new neighborhood of residential towers (albeit at a fraction of the height of Manhattan's supertall buildings), DNAinfo reviewed property records along the canal to find out who stands to benefit most from the changes.
Investors have poured at least $440 million into buying land on the polluted waterway and more than a third of the properties have changed hands in the past decade, according to an examination of records for the nearly 130 properties along the 1.8-mile canal. While the single largest landowner is developer Property Markets Group, other landowners include Kushner Companies, Alloy Development, Two Trees, and Forest City New York.

Forest City's plans unc…