Skip to main content

ESDC files request to appeal decision ordering new environmental review, says “shadow of uncertainty" shrouds project's Phase 2

Yes, Empire State Development (ESD), the state agency overseeing Atlantic Yards, is not accepting defeat. It is seeking to appeal a unanimous loss last month in the Appellate Division, which upheld a lower court's requirement that a Supplementary Environmental Impact Statement (SEIS) be conducted to examine the impacts of a 25-year project buildout.

The effort may seem like a long shot, but state Court of Appeals has proven friendly to Atlantic Yards before--remember the November 2009 eminent domain decision. It must first agree to accept the appeal. The key part of the ESD's motion:
The Appellate Division's order requiring that a SEIS be prepared to study the impacts of a delay in the Project's construction schedule is an unprecedented expansion of SEQRA [State Environmental Quality Review Act] that would interfere not only with progress being made on the Atlantic Yards Project, but with the progress of other large-scale projects that are subject to delays due to adverse economic conditions or other circumstances.
"Shadow of uncertainty"

I'll have more once I see Forest City Ratner's expected companion motion, and the petitioners' response. But the ESD contends that the court decision "casts a shadow of uncertainty on Phase II of the Project," a shadow elongated by the preparation of the SEIS and the inevitable legal challenges it will prompt.

Then again, Forest City has another decade to build Phase 1, the towers around the arena block, and eight years to start the first tower (of 11) in Phase 2, east of Sixth Avenue.

At a meeting with community stakeholders on 5/2/12, ESD CEO Kenneth Adams said the agency had not decided whether to appeal. Some community members, as well as Council Member Steve Levin, said an appeal sent the wrong message.

Updated: coverage from Crain's NY Business

Here's coverage in Crain's, with quotes from ESD:
“ESD conducted the legally-required hard look analysis at impacts of delay, and our review demonstrated no new significant impact not previously disclosed and addressed,” said Kenneth Adams, president of the Empire State Development Corp. in a statement. “ESD's goal is to keep all phases of the project moving forward to ensure that the community can receive the benefits of a world-class development that will bring thousands of jobs, affordable housing, open space and community facilities to Brooklyn as soon as possible.”
In a statement, a Forest City spokesman said, “We of course agree with the state's decision to appeal and are equally focused on moving this project forward given the promise of jobs, affordable housing and much needed tax revenue for the city and the state.”
However, the project’s opponents believe that there is a very slim chance that the ESDC will be allowed to appeal because two courts found it acted illegally.
“We are disappointed in ESDC’s decision to bring an appeal instead of working with the community to make the project better and just do the environmental impact study,” said Jeffrey Baker, a partner at the law firm of Young Sommer, which is representing Develop Don’t Destroy Brooklyn, a group opposed to the project. “The appeal is a waste of resources.”
Of course, if the state agency wanted the project to proceed "as soon as possible," then it wouldn't have signed a Development Agreement providing 25 years to build the project before penalties--other than regarding a few buildings--kicked in.

Comments

Popular posts from this blog

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…

At 550 Vanderbilt, big chunk of apartments pitched to Chinese buyers as "international units"

One key to sales at the 550 Vanderbilt condo is the connection to China, thanks to Shanghai-based developer Greenland Holdings.

It's the parent of Greenland USA, which as part of Greenland Forest City Partners owns 70% of Pacific Park (except 461 Dean and the arena).

And sales in China may help explain how the developer was able to claim early momentum.
"Since 550 Vanderbilt launched pre-sales in June [2015], more than 80 residences have gone into contract, representing over 30% of the building’s 278 total residences," the developer said in a 9/25/15 press release announcing the opening of a sales gallery in Brooklyn. "The strong response from the marketplace indicates the high level of demand for well-designed new luxury homes in Brooklyn..."

Maybe. Or maybe it just meant a decent initial pipeline to Chinese buyers.

As lawyer Jay Neveloff, who represents Forest City, told the Real Deal in 2015, a project involving a Chinese firm "creates a huge market for…

Is Barclays Center dumping the Islanders, or are they renegotiating? Evidence varies (bond doc, cash receipts); NHL attendance biggest variable

The Internet has been abuzz since Bloomberg's Scott Soshnick reported 1/30/17, using an overly conclusory headline, that Brooklyn’s Barclays Center Is Dumping the Islanders.

That would end an unusual arrangement in which the arena agrees to pay the team a fixed sum (minus certain expenses), in exchange for keeping tickets, suite, and sponsorship revenue.

The arena would earn more without the hockey team, according to Bloomberg, which cited “a financial projection shared with potential investors showed the Islanders won’t contribute any revenue after the 2018-19 season--a clear signal that the team won’t play there, the people said."

That "signal," however, is hardly definitive, as are the media leaks about a prospective new arena in Queens, as shown in the screenshot below from Newsday. Both sides are surely pushing for advantage, if not bluffing.

Consider: the arena and the Islanders can't even formally begin their opt-out talks until after this season. The disc…

Skanska says it "expected to assemble a properly designed modular building, not engage in an iterative R&D experiment"

On 12/10/16, I noted that FastCo.Design's Prefab's Moment of Reckoning article dialed back the gush on the 461 Dean modular tower compared to the publication's previous coverage.

Still, I noted that the article relied on developer Forest City Ratner and architect SHoP to put the best possible spin on what was clearly a failure. From the article: At the project's outset, it took the factory (managed by Skanska at the time) two to three weeks to build a module. By the end, under FCRC's management, the builders cut that down to six days. "The project took a little longer than expected and cost a little bit more than expected because we started the project with the wrong contractor," [Forest City's Adam] Greene says.Skanska jabs back
Well, Forest City's estranged partner Skanska later weighed in--not sure whether they weren't asked or just missed a deadline--and their article was updated 12/13/16. Here's Skanska's statement, which shows th…

Not just logistics: bypassing Brooklyn for DNC 2016 also saved on optics (role of Russian oligarch, Shanghai government)

Surely the logistical challenges of holding a national presidential nominating convention in Brooklyn were the main (and stated) reasons for the Democratic National Committee's choice of Philadelphia.

And, as I wrote in NY Slant, the huge security cordon in Philadelphia would have been impossible in Brooklyn.

But consider also the optics. As I wrote in my 1/21/15 op-ed in the Times arguing that the choice of Brooklyn was a bad idea:
The arena also raises ethically sticky questions for the Democrats. While the Barclays Center is owned primarily by Forest City Ratner, 45 percent of it is owned by the Russian billionaire Mikhail D. Prokhorov (who also owns 80 percent of the Brooklyn Nets). Mr. Prokhorov has a necessarily cordial relationship with Russia’s president, Vladimir V. Putin — though he has been critical of Mr. Putin in the past, last year, at the Russian president’s request, he tried to transfer ownership of the Nets to one of his Moscow-based companies. An oligarch-owned a…