Skip to main content

In New Rochelle, Forest City billing city after demise of Echo Bay plan

Everyone knows that Forest City Enterprises--and its subsidiaries--answers to its shareholders and the bottom line, and plays hardball when it counts, as exemplified in its Yonkers project and in Atlantic Yards. (So much for corporate social responsibility.)

So in the aftermath of a relatively unusual project failure in New Rochelle, it's not unsurprising to read the 2/13/14 Journal News article, New Rochelle gets $2M bill for axed Echo Bay project, doesn't plan to pay: City says there's 'no legal basis' for claim:
NEW ROCHELLE — Forest City Residential — which spent the better part of a decade trying to win approval for a massive waterfront development at Echo Bay — now wants New Rochelle to pick up the tab for its failed proposal.
In a Feb. 5 letter, Forest City demanded New Rochelle “immediately” reimburse the company $2 million in expenses, citing the terms of a memorandum of understanding the two sides signed in 2008 and amended over the years.
New Rochelle isn’t buying it. A statement issued by City Hall on Wednesday night pointed out that Forest City invested in the project voluntarily and maintained that there is “no legal basis” for the developer’s claims.
Forest City is pinning its claim for reimbursement on the City Council’s refusal to approve a land disposition agreement in November, which would have moved the project forward..
The city said it did nothing wrong. The newspaper couldn't get any more explanation regarding the plan, which--as the newspaper described it--started as a hotel, 700 residential units and more than 100,000 square feet of retail space, then was cut to 285 residential units and a quarter of the retail space. 

Ultimately, the city council voted 6-1 against Echo Bay, with only Mayor Noam Bramson for it. Forest City spent a total of $3.2 million--which, compared to Atlantic Yards pre-development costs, is a drop in the bucket.

A columnist's take

In a 2/15/14 column, Journal News columnist Phil Reisman wrote, Echo Bay suit is Forest City v. the people
In its quest to get its money back, Forest City has sicced its lawyers on the city. Mark Weingarten, an attorney with the powerful Democratic law firm of DelBello Donnellan Weingarten Wise & Wiederkehr (the DelBello stands for Alfred B. DelBello, the former Westchester County executive) fired off a three-page letter to City Manager Chuck Strome. It’s packed with angry modifiers and adverbs, accusing the city of “peremptorily, willfully, arbitrarily and without any rational basis” and so on.
...The billable hours it took to compose that monumental letter must’ve cost Forest City a pretty penny all by itself, but they’ve got the right guys on the case: a law firm that effectively spreads campaign donations around like magic fairy dust and, it seems, has an interest of one kind or another in just about every town in Westchester County.
Reisman takes a look at the larger picture:
Forest City’s hardball reputation was earned by other large-scale, mixed-use development projects in the metropolitan region, namely Atlantic Yards in Brooklyn and Ridge Hill in Yonkers. One of the loudest critics has been Cause of Action, a Washington, D.C.-based government accountability group, that produced a three-part report on Forest City’s tactics.
In the case of New Rochelle’s Echo Bay, Cause of Action concluded that the developer used political contributions and lobbyists to secure a “sweetheart deal.” When the city finally rejected the deal, Cause of Action commented that the city’s citizens “have delivered a stunning rebuke to cronyism that benefits the politically connected at the expense of the taxpayers.”
His conclusion: when a "fiscally beleaguered but proud city" wants to fix its downtown in an economic downture, "add a dash of hubris from an earnest but out-of-touch mayor and the situation is just begging for a fast-talking outfit like Forest City to come knocking."

Yup, a fast-talking outfit.

Comments

Popular posts from this blog

Barclays Center/Levy Restaurants hit with suit charging discrimination on disability, race; supervisors said to use vicious slurs, pursue retaliation

The Daily News has an article today, Barclays Center hit with $5M suit claiming discrimination against disabled, while the New York Post headlined its article Barclays Center sued over taunting disabled employees.

While that's part of the lawsuit, more prominent are claims of racial discrimination and retaliation, with black employees claiming repeated abuse by white supervisors, preferential treatment toward Hispanic colleagues, and retaliation in response to complaints.

Two individual supervisors, for example, are charged with  referring to black employees as “black motherfucker,” “dumb black bitch,” “black monkey,” “piece of shit” and “nigger.”

Two have referred to an employee blind in one eye as “cyclops,” and “the one-eyed guy,” and an employee with a nose disorder as “the nose guy.”

There's been no official response yet though arena spokesman Barry Baum told the Daily News they, but take “allegations of this kind very seriously” and have "a zero tolerance policy for…

Behind the "empty railyards": 40 years of ATURA, Baruch's plan, and the city's diffidence

To supporters of Forest City Ratner's Atlantic Yards project, it's a long-awaited plan for long-overlooked land. "The Atlantic Yards area has been available for any developer in America for over 100 years,” declared Borough President Marty Markowitz at a 5/26/05 City Council hearing.

Charles Gargano, chairman of the Empire State Development Corporation, mused on 11/15/05 to WNYC's Brian Lehrer, “Isn’t it interesting that these railyards have sat for decades and decades and decades, and no one has done a thing about them.” Forest City Ratner spokesman Joe DePlasco, in a 12/19/04 New York Times article ("In a War of Words, One Has the Power to Wound") described the railyards as "an empty scar dividing the community."

But why exactly has the Metropolitan Transportation Authority’s Vanderbilt Yard never been developed? Do public officials have some responsibility?

At a hearing yesterday of the Brooklyn Borough Board Atlantic Yards Committee, Kate Suisma…

Barclays Center event June 11 to protest plans to expand Israeli draft; questions about logistics

At right is a photo of a poster spotted in Hasidic Williamsburg right. Clearly there's an event scheduled at the Barclays Center aimed at the Haredi Jewish community (strict Orthodox Jews who reject secular culture), but the lack of English text makes it cryptic.

The website Matzav.com explains, Protest Against Israeli Draft of Bnei Yeshiva Rescheduled for Barclays Center:
A large asifa to protest the drafting of bnei yeshiva in Eretz Yisroel into the Israeli army that had been set to take place this month will instead be held on Sunday, 17 Sivan/June 11, at the Barclays Center in Downtown Brooklyn, NY. So attendees at a big gathering will protest an apparent change of policy that will make it much more difficult for traditional Orthodox Jewish students--both Hasidic (who follow a rebbe) and non-Hasidic (who don't)--to get deferments from the draft. Comments on the Yeshiva World website explain some of the debate.

The logistical questions

What's unclear is how large the ev…

Atlanta's Atlantic Yards moves ahead

First mentioned in April, the Atlantic Yards project in Atlanta is moving ahead--and has the potential to nudge Atlantic Yards in Brooklyn further down in Google searches.

According to a 5/30/17 press release, Hines and Invesco Real Estate Announce T3 West Midtown and Atlantic Yards:
Hines, the international real estate firm, and Invesco Real Estate, a global real estate investment manager, today announced a joint venture on behalf of one of Invesco Real Estate’s institutional clients to develop two progressive office projects in Atlanta totalling 700,000 square feet. T3 West Midtown will be a 200,000-square-foot heavy timber office development and Atlantic Yards will consist of 500,000 square feet of progressive office space in two buildings. Both projects are located on sites within Atlantic Station in the flourishing Midtown submarket.
Hines will work with Hartshorne Plunkard Architecture (HPA) as the design architect for both T3 West Midtown and Atlantic Yards. DLR Group will be t…

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…