Friday, February 18, 2011

Winning the lottery: The speculator who damned Ratner, got $3 million for his Pacific Street property, and then gushed about the developer

So, here's a story credulous Daily News columnist Denis Hamill somehow missed: a speculator (like the guys who bought the building housing Freddy's), who slammed Forest City Ratner when it was strategic, then, after he cashed in for $3 million, praised Bruce Ratner to the skies.


Crown Heights resident Menachem Friedfertig bought this empty garage, at 622 Pacific Street, in May 2003, for $382,000, as noted in the document embedded below. That was two months before any mention of Atlantic Yards surfaced in the press, and six months before the plan was announced.

According to the New York Sun, whose 9/2/04 article was headlined "Message to Ratner: ‘I Want My $4M’: Brooklyn Developer Looks To Cash In," Friedfertig planned a new building, with medical offices on the first floor, and five stories of condos, all permitted by current zoning, and got approval from the Department of Buildings.

He clearly felt he had lucked out, telling the Sun, "I have the winning lottery ticket and I want my $4 million."

When I wrote about this 1/20/06, I didn't know what kind of deal Friedfertig made. ACRIS as of 5/2/06 (right, though the document embedded below has no figure) says it was $3 million, an enormous profit.

A better deal than Goldstein

That's a far better deal for Friedfertig than the $3 million Forest City Ratner paid in 2010 to get Daniel Goldstein to leave 636 Pacific Street condo he'd already lost to eminent domain, given the higher initial cost of Goldstein's property, taxes, the now-inflated cost of replacement, and attorney's fees. (The latter two push $2 million.)

Oh, and the fact that Goldstein lived there seven years, enduring demolition and other construction activities.

But Forest City Ratner did not orchestrate a media crusade against Friedfertig, as it's done with Goldstein.

Why not? Because Friedfertig changed his tune, very conveniently.

At the 2004 hearing

Freidfertig's testimony at the 5/4/04 City Council hearing showed no love for Bruce Ratner:
Good afternoon. My name is Menachem Friedfertig from Crown Heights. I wrote things out, but watching these proceedings and why I am here, right now, the only way to convince you is to tell you that it is in your interest to look deeply into this, and not to be fooled. And I am going to tell you an anecdote.

People are coming to you and saying, oh, there is going to be more jobs, there is going to be more housing, and jobs for all people, and there is going to be money. And they say, why should we do it, you have a few houseowners, homeowners, and a few business people, but come on, we will push them out, whatever. But by in large you are going to get that goal at the end of the road. But that is a lie. Because we are talking about building. If you are building a building, and the foundation is no good, that building is no good.

And this is what I want to say. I bought before I even heard about Ratner. I bought a property at 622 Pacific Street. I said this is nice, it was an old broken down garage building, I said, well, I will knock it down, build it right.

It is R-7 zoning, a nice little six, five story, whatever, a nice, like a tree grows in Brooklyn, I visited different architects. My wife said, you are crazy. I said you will see its nice. Everything was going along fine, we filed with the Buildings Department, everything was going nice. Suddenly, about two months ago, the attorney who closed on it for me gets a call from one of Ratner's people. And he says, we are giving you the courtesy of calling you before the condemnation process happens. Before this happens, we are calling different people to see if you want to sell. So what did he think we were going to knuckle under. That is what they thought.

You know, Mr. Ratner, and I can speak the same language, I think you should tell him that this is the most, utmost of chutzpah. And just as he is trying to push out the little guy, and God forbid if he will do that successfully, do you think he is not going to hurt you at the end, also?

Thank you very much, and please be careful.
A roadblock to the Olympics?

In a 2/20/05 article headlined The Mike-athalon, concerning the Bloomberg Administration's effort to lure the 2012 Olympics, the Observer's Matthew Schuerman pointed out some snags in the plan, including some roadblocks in the path of a proposed Brooklyn arena, one of 33 proposed venues.

The Observer reported:
"Not only do I own it, but I have approved plans to build. I just haven't built it," said Menachem Friedfertig, a Brooklyn landlord who bought 622 Pacific Street at an auction more than a year ago. Mr. Ratner's folks made an offer a year ago, but Mr. Friedfertig turned them down. "In fact, when I met with them, I said, 'I think I'm against your backboard,' and they said, 'Actually, you're in our grandstands.'

"I really had my hopes set on developing it. It was going to be my first development project. It was my little baby. It was going to be a cute little brownstone thing."
Changing his tune

At the 9/12/06 community forum (a not-quite public hearing) sponsored by the Empire State Development Corporation, Friedfertig changed his tune.

The reasons? Probably because he not only got most of the money he sought, and an enormous, painless profit, but also because of a requirement, as with many who agreed to deals with Forest City Ratner, that he testify in favor of the project.

(Courier-Life photo by Tammy Meadows)

As I reported, Friedfertig was effusive. “It was the most amazing thing,” Friedfertig said. “Mr. Ratner, he was so fair. He was such a mensch.”

Friedfertig, an Orthodox, Hasidic Jew, unveiled a shofar—the ram’s horn used in Jewish ritual—as a gift to Bruce Ratner and proposed that the developer “should blow it on opening day at Ratner arena."

The Brooklyn Paper, in Low turnout at Ratner hearing, quoted him:
“Mr. Ratner gave me a deal. He dealt with me in the most ‘erlach’ way [Yiddish for honest]. What an angel. What a mensch. I bought a garage at a public auction and it was the most amazing thing that ever happened to me when Mr. Ratner decided to buy it for this Atlantic Yards project. [His offer] was beyond my wildest expectations. I present this shofar to Mr. Ratner. He should blow it on the Nets opening day.”
Maybe it was beyond Friedfertig's wildest expectations, but it was actually less than the $4 million he once sought.

It was, however, a lottery ticket, not just for him, gaining far more than he paid, but also for Forest City Ratner, gaining the right to build far larger than zoning permitted.

622PacificFirstSale

622PacificSecondSale

1 comment:

  1. Your report today shows what willing dupes to Ratner's PR campaign almost all reporters and columnists have been.

    Though it should take nothing but common sense to realize the difference between those who used eminent domain to make a quick buck versus those who fought against it for years until they had no more recourse to protect their homes—and I'm talking not just about myself but numerous other property owners and tenants. Guys like Friedfertag used the community uproar to make a quick buck, after mock outrage.

    The fighters put themselves on the front lines.

    But "reporters" like Denis Hamill allow Ratner to say things like "eminent domain? no big deal, we all move plenty of times in our lives," without challenge.

    It's shameful journalism.

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