Friday, May 15, 2015

Ratner's Nassau Coliseum plans: a fast review before August groundbreaking, a "professional" hockey team, but still several hurdles

First of a five-part series on Forest City Ratner's plans for Nassau Coliseum redevelopment.

This concerns the overall plan. Part 2 addressed the curious politics of a Community Benefits Agreement. Part 3 addressed the astonishing pitch in China for EB-5 investment. Part 4 discussed Forest City's claim, at the Nassau County Legislature, it wasn't making much profit on EB-5, and its defense of a sketchy fundraising partner. Part 5 concerned the brazen effort by EB-5 promoters to use an excerpt from this blog.

A cheery press event last month.
Bruce Ratner's Nassau Coliseum redevelopment plans are humming along fine.

Or not.

On 4/14/15,  Ratner's Nassau Events Center submitted key documents--a conceptual master plan and environmental assessment form--to the Town of Hempstead, which was more than ready to fast-track approval for a groundbreaking in August.

A day earlier, the Nassau County Legislature, with just a smidgen of controversy, 17-2 approved an amendment to the planned Coliseum lease, which allows Forest City to use $90 million in EB-5 funding from immigrant investors seeking green cards.

The controversy only somewhat concerned the sketchy EB-5 program but rather focused on the developer's rejection of a Community Benefits Agreement (CBA) sought by a coalition in the town of Uniondale. And there was barely a mention of two other touchy issues: the possibility of the New York Islanders having a short stay at the Barclays Center, and dueling lawsuits filed by Ratner and a former partner.

Hurdles and pushback

Since then, however, Newsday reported 4/29/15, that the Nassau Events Center still faced several hurdles:
Ratner has to attract and sign a lease with an American Hockey League team; establish project labor agreements; finalize financing, including his plans to bring in $90 million in Chinese investment and any Industrial Development Agency aid he is expected to ask for; and receive all town approvals on detailed plans and environmental reviews for the Coliseum and its "plaza," the area surrounding the arena.
And Newsday, in editorials and columns, has expressed skepticism. Wrote columnist Michael Dobie 5/1/15, "Now we have a too-little, too-late Coliseum renovation promised by Bruce Ratner, the same guy whose company built the Isles' new home, the Barclays Center."

In a 5/3/15 editorial, Newsday wrote:
Deep in the agreement between developer Bruce Ratner and Nassau County to redevelop the Nassau Coliseum site is a daunting clause. The lease indicates Ratner doesn't believe he can pursue the project without the help of the Nassau County Industrial Development Agency. If one of the most valuable properties on Long Island can't be developed in a way that allows it to pay its full share of taxes, something is very wrong.
In other words, though the "historic public-private partnership... a 100% privately financed Coliseum that will share revenue with the County at zero expense to the taxpayer," touted by Nassau County Executive Ed Mangano does depend on public help. Tax breaks cost the public just as do direct subsidies.

Similarly, the newspaper stated in a 5/11/15 editorial, New Coliseum plan isn't transformative, expressing doubts that Ratner would accomplish all he promises.

(Newsday noted that its parent company Cablevision, holds a controlling interest in Madison Square Garden, the losing bidder on the Coliseum renovation: "[County Executive Ed] Mangano keeps mentioning this in an attempt to undercut any Newsday reporting and commentary that take a hard look at the facts. It's an all-too-familiar ploy.")

Mangano indeed wrote a critical letter 5/3/15:
Lost in the coverage of the Nassau Coliseum's redevelopment [the article at the top of this section] is the simple but compelling fact that private investment, not taxpayer dollars, will transform the facility from an obsolete and worn-out building to a state-of-the-art destination that generates jobs, investment and tax revenue.
Newsday's reporting suggests there are multiple hurdles to be addressed before groundbreaking. That is true of any major construction project, and certainly true of one such as this, which will serve the region for generations to come. It would be wise, however, to explore the strategic economic rate of return for residents rather than speculate on when and how the Town of Hempstead will conduct a planning review for the site. The same holds true for whether the NHL will embrace future opportunities in Uniondale -- the league has a fiduciary obligation to say "show me the building" before offering an affirmative opinion.
Also see critical coverage in the 5/15/15 Long Island Business News, Stubbed hub, which describes the breakup betweeen Forest City and former partner Blumenfeld Development Group (BDG)::
In its quest to create a unique destination outside of the Coliseum, BDG has signed letters of intent and has been in talks with a lengthy list of tenants that would attract visitors. Those included in discussions for the first phase are Bass Pro Shops; Dave & Buster’s; indoor trampoline park Bounce; PolerCoaster, an indoor vertical roller coaster; Topgolf, a new-age driving range; Gotham Comedy Club; Rock & Brews; Great Wolf Lodge; Planet Fitness; AMC movie theater; and more shops and restaurants. The BDG design includes public athletic fields.
...In its lawsuit, Forest City Ratner claims BDG made arrangements with tenants behind its back and asks the court to recognize that their partnership was never finalized. Blumenfeld’s suit contends that Forest City Ratner was kept in the loop on its retail/entertainment plans and wants the court to uphold its 50 percent partnership in the Coliseum property’s ancillary development. The next court conference on the case is scheduled for Monday [5/18/15].
Last month, a time for bonhomie

Still, the press conference 4/14/14, as shown in the screenshot top right, was full of bonhomie. Hempstead Town Supervisor Kate Murray (standing closest to Ratner in the center of the photo above) described him as a "respected developer."

She cited the Nassau Events Center plan for the renovated Coliseum "and an additional 188,000 square feet associated construction," with a master plan that "accommodates 3.4 million square of cohesive development on the 91-acre site surrounding the Coliseum."

She noted that, after the previous Lighthouse project stalled, the Hempstead Town Board "took the unique step to spur development at the Uniondale site surrounding the Coliseum," creating a "building construction zone" that sets parameters for building. That means the environmental review is mostly already done, and can be finished quickly.

Newsday reported that a public hearing will be held May 19 to review the master plan.

Press Conference; Hub Conceptual Master Plan Submitted to Town of Hempstead from Nassau Executive on Vimeo.

Ratner's thanks

Ratner was all smiles, calling it "a very special day," praising Murray and County Executive Ed Mangano, and claiming "it's special because of where it's located... so many people pass it by car...
The real goal is to do the very best job."

Hempstead Council Member Dorothy Goosby declared, "We're so grateful, especially the Uniondale community, for this wonderful, wonderful idea. I'm sure you will maintain and keep up with everything you promised." (She's not on board with the CBA, clearly.)

Another Hempstead Council Member, Anthony Santino, declared, with typical rhetoric, that this would "kickstart our economy."

Mangano saluted this "step to fulfilling our vision of creating a world-class destination... turning that concrete jungle into a thriving destination.."

What about hockey?

Mangano declared that "the plan certainly provides the opportunity for a professional ice hockey team to play in the arena." Give that that encompasses a minor league team, it not quite the same as Mangano's bizarro statement that he aims to try to keep the Islanders in Nassau.

Asked about that later statement, Ratner demurred: "That's why we have a county executive, he answers those questions."

Asked about whether the Islanders can opt out of the Brooklyn lease after five years, Ratner wouldn't comment, as noted by Newsday's Robert Brodsky.

He did say that a minor league American Hockey League team will come to the Coliseum.

What tenants

Ratner said he wasn't ready to announce specific tenants, but "we've got a movie theater we're working, on, it's got a restaurant in it." He said a "few other restaurants" and "two other entertainment uses" would be coming. That will fill the 188,000 square feet.

He also touted plans by Memorial Sloan Kettering Hospital, on whose board he sites, to come to the site, saying he hoped the area can become a research and medical center, near Hofstra University School of Medicine.

Asked about whether the lawsuit filed by former partner BDG would affect the plans, Ratner looked somber, though not as much as Murray and Mangano in the screenshot at left.

"I don't comment on lawsuits," Ratner said, then proceeded to comment: "Ot won't have an impact, I can't imagine it would... it won't affect the timing of any of this."

The first phase includes, as Long Island Business News noted with more specifics, a "1,500 seat cinema with restaurant, entertainment and recreation space, themed restaurants, retail, a veterans’ memorial and a new home for Island Garden Basketball."

However, because Ratner's lease does not require it, Newsday notes that it's unclear how much of master plan--two hotels, a convention center, and more--will be built. Newsday commenters offered a lot of skeptical comments about the viability of the retail, given the existing competition.

The press release:
August Groundbreaking Expected for Coliseum Transformation, Cinema, Restaurants, Retail and Recreation
Mineola, NY – Nassau County Executive Edward P. Mangano and Town of Hempstead Supervisor Kate Murray today announced that Nassau Events Center (NEC) has submitted a Conceptual Master Plan to the Town. Phase I of the project, estimated to break ground in August 2015, includes transformation of the Nassau Veterans Memorial Coliseum into a world-class arena as well as renovation of the facility’s Exhibition Hall into the Filmore Theatre – a center for performing arts. Additionally, Phase I includes Plaza construction of a 1,500 seat cinema with restaurant, entertainment and recreation space, themed restaurants, retail, a veterans memorial and a new home for Island Garden Basketball. NEC is responsible for all construction, renovation and maintenance costs at the Coliseum and Plaza.
County Executive Mangano stated, “Nassau County is one step closer to transforming the Hub into an economic generator that creates and retains new jobs along with a vibrant, attractive destination for Long Islanders and those visiting our region. Our vision for the Hub will strategically grow Nassau County’s economy by transforming the current cement jungle surrounding the Nassau Veterans Memorial Coliseum into a sports-entertainment destination with employers that complement existing educational and healthcare institutions, financial companies and research and development.”
Under the Conceptual Master Plan, the size of the Coliseum remains unchanged. Accordingly, the new seating capacity can be expanded to current size. The Conceptual Master Plan also positions the County to attract additional employers adjacent to the Coliseum that complement existing educational institutions, financial companies and research and development. In the weeks ahead, County Executive Mangano will advance plans for Memorial Sloan Kettering Cancer Center to occupy 200,000 square feet of property at the Hub. This Phase II development brings 250 good-paying jobs, with an average salary of $150,000 annually to the property while serving as an anchor to attract research and development institutions.
“Hempstead Town has set a high standard for making the development review process more efficient by creating a forward-looking building construction zone and by pro-actively furnishing clear information on our zone’s requirements to developers,” said Hempstead Town Supervisor Kate Murray. “As a result, our Town Board is ready and eager to review NEC’s Conceptual Master Plan for this valuable Uniondale site.”
The Conceptual Master Plan offers a vision for the Hub beyond Phase II of the project. This vision includes designated areas of the property for office/medical/R&D space, recreation/entertainment/convention space, retail, hotels and parking garages. Traffic studies and environmental reviews have been conducted to ensure success is achieved in transformation of the Hub into a job-generating economic engine for Nassau County. 
“Today's submittal to the town of Hempstead brings us one step closer to beginning work on the redevelopment of the Coliseum site. I want to thank Town Supervisor Kate Murray for working closely with us to get to this moment,” said Bruce Ratner, Executive Chairman of Forest City Ratner Companies. “We look forward to beginning construction in the near future so that we can bring all Long Island residents the reimagined venue they truly deserve.”

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