Tuesday, June 25, 2013

Forest City Ratner chosen as master developer for first phase of Cornell's Roosevelt Island tech campus (updated)

It's a very good week for Forest City Ratner. Not only does new CEO MaryAnne Gilmartin get ranked the 16th most powerful woman in New York City by Crain's New York Business (up from 35 in 2011), Forest City was chosen by Cornell University as the master developer for the first two buildings on Cornell University's Roosevelt Island engineering campus.

The campus, known as Cornell Tech, may be the most important legacy of the Bloomberg administration, assuming it pays off as projected.

Forest City would build and own the second building, which would house private-sector tenants, while it would build but not own the first building, to be used for academic purposes, according to Crain's New York Business. The academic building would be 150,000 square feet and the office tech building would be 200,000 square feet.

Unanswered in the coverage and press release was how Forest City was chosen (was there any nudge from the mayor's office? any bidding?) and how the buildings would be financed.

Update Tuesday 1 pm: Cornell tells me:
There was a competitive process in response to an RFP issued by Cornell to qualified developers.
Buildings will be funded through private donations and investment from development partners.
Presumably Cornell will be able to draw on endowment and gift funds, among other sources. But Cornell already has nearly free land, a promise of $100 million in city subsidies, a promise for help in raising funds, and p.r. assistance, as stated in the RFP for the overall project, bottom.

I don't think the response rules out EB-5 funding. As I wrote in December 2011, the RFP listed the EB-5 immigrant investor program as part of a suite of potential economic development benefits, including tax-exempt financing (see Appendix E of RFP). Forest City has wide experience in using EB-5 funds via the New York City Regional Center for Atlantic Yards.

A fee developer relationship

Though Cornell didn't respond initially to my queries, the university did answer a few from Roosevelt Islander Online, which reported that financial terms are being finalized and Forest City would own the corporate co-location building and be responsible for leasing the space, with Cornell committing to be an anchor tenant essentially:
On the rest of the first phase FCRC would have a fee developer relationship, overseeing development of the first academic building, open space and infrastructure.What is not widely known about the Cornell NYC Tech project is that it is not yet a done deal. Although NYC has approved the Cornell NYC Tech ULURP application, Cornell NYC Tech must still reach an agreement with the Roosevelt Island Operating Corp (RIOC).
The press release

According to Real Estate Weekly, which published the press release,
Cornell NYC Tech today announced a major advancement in its effort to bring industry and academia together on its Roosevelt Island campus with plans to develop its first “corporate co-location” building. This building will house a mix of companies at the heart of the campus, facilitating the interaction between academia and industry that is central to Cornell Tech’s mission. On Thursday, Cornell University’s Board of Trustees approved the plan to move forward with Forest City Ratner Companies as the developer of this building, subject to finalizing plans and terms. Forest City Ratner would also act as master developer, overseeing development of the first academic building, the open space and related infrastructure for the first phase of the campus.
“This level of private sector investment in the campus, and, upon completion of our finalizing the details, the participation of a great partner in Forest City Ratner, validates the campus’ enormous economic development potential for New York and ensures that we will have a vibrant mix of activities when the campus opens in 2017,” said Cathy Dove, Vice President of Cornell Tech. “We expect that leading-edge companies large and small will be drawn to the innovation and energy of Cornell Tech, helping to accelerate the already rapid growth of New York’s tech sector.”
...“Forest City Ratner is thrilled to partner with Cornell Tech on the creation of a world class innovative campus that will drive the growth of New York’s tech sector and economic development in the city for years to come,” said Forest City Ratner Companies President and CEO MaryAnne Gilmartin. “From Metro Tech to Times Square to Barclays Center and Atlantic Yards, Forest City Ratner has always bet on the growth of our great city and we couldn’t be more excited to play a part in this next exciting chapter. With the corporate co-location building Cornell Tech is charting new territory, and we look forward to exceeding expectations with an iconic architectural design by WEISS/MANFREDI.”
The award-winning architecture, landscape and urbanism firm, WEISS / MANFREDI will be the architect of the co-location building, which together with Cornell Tech’s flagship academic building, designed by Pritzker Prize-winning architect Thom Mayne of Morphosis, will launch the Cornell Tech campus.
NYC Tech Campus RFP, July 2011

No comments:

Post a Comment