Tuesday, June 30, 2015

Forest City, naming new modular leader, pushing for "new business partners" and "new business opportunities" (even before B2 is done)

A Crain's New York Business article, originally headlined "Forest City Ratner creates a modular-housing division, names unit leader," has been  updated to Forest City Ratner will keep its modular-housing factory in Brooklyn, names construction exec to run it. Both have the subheading "Susan Hayes will lead FC Modular, which operates out of the Brooklyn Navy Yard."

The lead:
Forest City Ratner Cos. has created a new position to head up the firm’s modular-housing division, the company announced Monday, meaning that it plans to keep its Brooklyn Navy Yard factory running after the completion of a 32-story tower next to Barclays Center in downtown Brooklyn.
The firm tapped Susan Hayes, formerly an executive at a Manhattan construction firm, to lead the subsidiary, known as FC Modular, which currently runs a production facility in the Brooklyn Navy Yard.
“Modular construction is an important part of the future for our industry, and Susan will bring tremendous value as we seek new business partners and source new business opportunities going forward,” MaryAnne Gilmartin, chief executive of Forest City and one of Crain's 50 Most Powerful Women in New York, said in a statement.
Of course they can't make back their investment in the factory, as well as the expected loss on the first tower, B2 (aka 461 Dean Street), without more production. I've speculated that Forest City will seek/get some grant or support from government to build modular affordable housing.

A quote from Hayes, who came from the Manhattan-based construction management firm Cauldwell Wingate Co.:
“While our initial focus is the successful completion of [B2 BKLYN], this modern means of construction offers great promise in the creation of a wide range of high-quality, cost-effective and uniquely sustainable buildings,” Ms. Hayes said in a statement.
It's not clear whether this is a new position in function or name. Surely other personnel have acted as Forest City's point people for modular. 

About the backstory

Gilmartin herself has said the model has to be proven with an open and operating building. Here's Crain's:
The firm was constructing the tower with a U.S. arm of Swedish construction giant Skanska until last fall, when the two had an acrimonious and litigious split prompted by delays and budget overruns on the building, which was originally billed as costing $116 million and was set to open in late 2014.
That's not quite the full story. The issue is not merely delays and budget overruns, but Skanska's claims of design flaws

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