Friday, August 03, 2012

Is the arena project 95-98 percent complete, as Forest City claims? It probably depends on how you define "project"

"We're on the main concourse of the Barclays Center. Our project here is about 95, 98 percent complete," Forest City Ratner construction chief Bob Sanna says in a new video produced by the New York Daily News.

Is that credible? It probably depends on how you define "project." It may well be that they are less than 5 percent of the way from being able to fully test the building.

But Sanna's estimate differs significantly from the index used by Merritt & Harris, the consultant that reports monthly to the arena bond trustee, Empire State Development Corporation, and Forest City Ratner.

In the last report from Merritt & Harris, dated 7/9/12 and based on a 5/23/12 visit and documents dated 6/22/12, a chart indicated that the arena, as of May, was nearly 80 percent complete, on a path--as of the end of July--to be perhaps 85 percent complete.

(Note that the percentages are based on spending, and that the construction schedule was tweaked to show that it wasn't behind.)

Substantial and final completion

The building is supposed to reach a substantial completion date on 9/5/12. That gives arena operators little more than three weeks to test building systems before the first event, a 9/28/12 concert with superstar Jay-Z.

The final completion date is 6/30/13, which includes punch list work and subcontractor close-outs, though note that the chart above, unlike initial ones, does not indicate 100 percent spending by the end of June 2013. (That was one of the tweaks by Merritt & Harris.)

Will building be ready?
Surely they will make sure the building's ready for the Jay-Z concert; there's too much money at stake.

However, despite Sanna's professed confidence, they're cutting it close. As I wrote earlier this week, In an April 2010 sworn affidavit aiming to ensure that evictions of condemnees could proceed, Forest City Executive VP MaryAnne Gilmartin, who oversees Atlantic Yards, stated (p. 70):
Furthermore, it takes at least three to four months to commission an arena like Barclays Center--i.e., to test and refine the various buildings systems and the various operations (such as security and food services) that must be performing properly and efficiently before the arena can be opened for the professional basketball season. In other words, it is essential that the arena be completed by early July 2012, so that the commission process can be completed by the opening of the basketball season in October 2012.

Even if Gilmartin was exaggerating by 100 percent, that means it takes six to eight weeks to commission an arena. They have three weeks, or if they're starting now, just about eight weeks. That's cutting it close.

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