Thursday, July 12, 2012

First Atlantic Yards tower: modular plans still unresolved, but tax-exempt bonds proceeding, with hearing on July 18


Forest City Ratner this week began what its construction chief called “very very minor” work on the foundation and piles for Building 2, the first residential tower.

But it hasn’t decided whether to pursue modular construction, as negotiations with unions--who, expecting higher-paying jobs on site, aggressively supported Atlantic Yards--are unresolved.

Meanwhile, the New York City Housing Development Corporation is proceeding with the issuance of nearly $92 million in tax-exempt bonds to support construction. A hearing July 18, during which public comment will be accepted, will be held at 1 pm in Conference Room 4 A/B at 110 William Street, 4th Floor, in Lower Manhattan.

No further information is available as of now, which kind of retards public comment. The NYC HDC apparently published the notice in the New York Post this weekend, but no community people--including Council Member Letitia James--knew about it until Forest City Ratner executive Jane Marshall volunteered it at the Atlantic Yards District Service Cabinet meeting this morning.

The hearing

“I just wanted to mention it,” Marshall said, during the meeting at Borough Hall. “The notice went out, and we didn't see any reaction on the blogs.” (I contacted NYC HDC and got the notice below.)

Note that the subsidy is not worth $92 million; rather, it’s the difference between low-cost financing, aimed to support the 50% subsidized units, and higher-cost financing on the open market. Presumably Forest City will also package some market-rate financing with the tax-exempt bonds. Executives have said they can’t get a loan for modular construction until there’s an agreement with the unions.

As the notice indicates, further information is available at the hearing or "upon written request."The building is a 50/30/20 building--50% market-rate, 30% moderate/middle-income, 20% low-income.

Schedule unclear, but work now helps

The current work at the Building 2 site, construction chief Bob Sanna said, “makes very very good sense to do,” because, if not completed before the arena opens, it would “require certain shutdowns” of access from the street.

“The plan is to start construction after the arena opens but before the end of the year,” Marshall said. “That would mean that at some point would have a construction logistics plan that we would coordinate with DOB and DOT.”

She said the construction fence would be at the property line and would not impede sidewalk traffic.

Modular plans?

Will the building be modular?

“Some plans may have been filed, but we have not made the decision, though we are working very hard,” Marshall said. “We are pushing modular... We think it's a great thing, for the industry, for affordable housing, but all the pieces have to fall in place... We expect we will be making that call over the next few months

"Is there an agreement with the trade unions?" James asked.

“We continue to talk to the trade unions," Sanna replied. "They are involved in the process."

More subsidy?

Will there be any direct city subsidy, in addition to the tax-exempt bonds, asked Council Member Steve Levin.

“Not that I'm aware of,” replied Marshall.

Note that Rafael Cestero, then head of the NYC Department Housing Preservation and Development, in March 2011 said the city had denied a request for an additional $10 million subsidy on top of an existing $14 million.

(It’s not clear to me whether there’s a direct $14 million subsidy or whether $14 million is the value of tax-exempt bond savings. I'm checking and will update this.)

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